Public Service Loan Forgiveness

Alum Financial

If you make 120 qualifying payments while working full-time in certain public service positions, the remaining balance on your Direct Loans may be forgiven. FFEL Loans or Perkins Loans will not qualify for Public Service Loan Forgiveness.

If you consolidate your FFEL or Perkins loans into a Direct Consolidation Loan, those loans could then become eligible for forgiveness. Just remember, any payments you made on your loans before they were consolidated will not count towards loan forgiveness. And anytime you consolidate a loan you could lose any benefits attached to that original loan, so be sure to evaluate your loan terms before deciding to consolidate.

In order to receive loan forgiveness, you must be enrolled in a qualifying repayment plan:

• Standard Repayment Plan
• Income-Based Repayment Plan
• Income-Contingent Repayment Plan
• Pay As You Earn Repayment Plan
• Any repayment plan where your monthly payment is equal to or greater than what your payment would be under the Standard Repayment Plan

While Standard Repayment is an eligible repayment plan for Public Service Loan Forgiveness, if you make all of your monthly payments for 10 years under Standard Repayment, there will be no balance remaining to forgive. If you are enrolled on a plan that lowers your payments based on your income, you will likely still have a balance to forgive after 10 years.

Examples of public service employment include working for:

• A government organization
• Anon-profit501 (c)(3) organization
• A private, non-profit organization that provides a public service,including: law enforcement, public safety, military service, emergency management, public education, early childhood education, public or school library services, public interest legal services, public health, public service for the elderly or those with disabilities.
• AmeriCorps or PeaceCorps

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