More Penn State employees may qualify for federal loan forgiveness

UNIVERSITY PARK, Pa. — Under temporary U.S. Department of Education rules, far more Penn state employees than in the past could qualify for student loan forgiveness. The Sokolov-Miller Family Financial and Life Skills Center is available to help employees — as well as Penn State students and alumni — determine if they are eligible and apply for loan forgiveness.

The temporary rules will increase the number of people eligible for federal loan relief under the Cancellation of civil service loans (PSLF). Because Penn State is a qualified employer under the program, many faculty and staff may be eligible for loan forgiveness, even if they have applied for the PSLF and been denied in the past.

To help members of the Penn State community navigate these temporary PSLF changes, the Sokolov-Miller Family Financial and Life Skills Center will offer one-on-one counseling and two public information sessions. Currently, the temporary rule change (called a “limited waiver”) is set to expire on October 31, 2022, so those seeking forgiveness must act before that deadline.

The public sessions aim to provide a broad overview of the PSLF, but the one-on-one appointments will be especially helpful for those who may be eligible for a pardon, according to Julie Heaton, director of the Sokolov-Miller Family Center.

“There are many facets to the PSLF and the Limited Waiver, so we encourage members of the Penn State community who may benefit from loan forgiveness to contact us individually,” Heaton said. “Time is running out, as some processes can take weeks or months. If people think they might be eligible for the PSLF, they should start these processes by early August at the latest.

The two 45-minute public information sessions are scheduled for:

  • 3:30 p.m. Thursday July 14
  • Noon Tuesday August 9

Sessions will be conducted on Zoom and recorded. Session links are available at

Faculty, staff, and alumni can schedule individual appointments with the center by emailing [email protected], including their name and indicating that they would like a PSLF consultation. Current students can book an appointment through Starfish.

The cancellation of civil service loans to enter the 15th year

Implemented in its original form in 2007, the Civil Service Loan Forgiveness Program forgives – completely and untaxed – the remaining balance on direct loans after borrowers make 120 qualifying monthly payments while working for an employer. eligible public service (such as Penn State). However, for years student loan advocates have pushed to fix the program’s problems and provide more and clearer information about the program to the public.

In 2017, a review by the US Government Accountability Office found that 10 years after the program began, few eligible borrowers had actually had their loans forgiven, and reviewers recommended changes to the program, as well as changes to information provided by loan servicers. In response, the US Department of Education rolled out the limited waiver rules last October.

One of the most significant changes under the temporary rules is that payments made under Federal Family Education Loans (FFEL, a type of loan that ceased in 2010) can now be counted as payments. of a borrower. However, borrowers must “consolidate” these loans into direct loans.

“A lot of people got burned by having FFEL loans and thinking that when they paid them, their payments counted towards their 120 payments under the PSLF,” Heaton said.

There are many other limited waiver provisions, such as changes to forbearance periods, payments made, payment plans, and time spent in deferment.

“The big takeaway with the limited waiver is that if you’ve been declined in the past — because of loan type, payment plan, or amount paid — you should try to get a certification form in the service. FedLoan loans before October 31 to see if you qualify,” Heaton said.

The Sokolov-Miller Family Financial and Life Skills Center will continue to provide PSLF support throughout the limited waiver period.

The Sokolov-Miller Family Life and Financial Skills Center provides services to the entire Penn State community and is part of Penn State Undergraduate Education.

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