Advocates Seek Extension of Public Service Loan Forgiveness Waiver

• A temporary change has granted debt relief for many in public service and government jobs.
• However, that change is set to revert to normal in just over three months.
• One analysis suggests millions could qualify for relief through the waiver but haven't yet applied.

A temporary waiver that's granted total student loan relief to hundreds of thousands of borrowers is set to expire in just over three months, but advocates hope to keep the waiver going.

A group of 134 organizations with higher education and borrower advocacy ties co-signed a letter to President Joe Biden asking that he extend the current public service loan forgiveness (PSLF) waiver, as well as the newer income-driven repayment (IDR) plan waiver. The signatories pointed to data that shows the PSLF waiver has led to a sharp uptick in the number of borrowers who have qualified for relief since Biden's administration started it in October as a reason to keep the program as is.

The PSLF waiver will expire after Oct. 31, leaving just a few more months for qualified borrowers to take the necessary steps to qualify for forgiveness.

PSLF allows those working in nonprofit and public or government organizations to qualify for total federal student loan forgiveness after 10 years of repayment on an IDR plan. Instituted in 2007, a small percentage of borrowers qualified in practice. The limited waiver helped lower the bar for many.

According to an analysis from the Student Borrower Protection Center, approximately 16,000 borrowers had qualified for PSLF forgiveness as of September of last year, just before the waiver went into effect. As of May, the number had grown ninefold to 146,000.

“President Biden made a bold promise to remedy the well-documented failures of the [PSLF] and [IDR] programs...But unless these actions are coordinated and given the time and attention that they need, millions of eligible borrowers will miss out on relief.”
— Persis Yu, Student Borrower Protection Center

“President Biden made a bold promise to remedy the well-documented failures of the [PSLF] and [IDR] programs and deliver life-changing relief to millions of federal student loan borrowers," Persis Yu, policy director at the Student Borrower Protection Center, said in a statement. “But unless these actions are coordinated and given the time and attention that they need, millions of eligible borrowers will miss out on relief."

The letter asks Biden to extend the deadline of the PSLF waiver through at least 2023 and calibrate the adjoining IDR waiver — which currently has no end date — accordingly.

Both waivers allow previously ineligible payments to count toward the timeline for forgiveness. In the case of the PSLF waiver, it opened the door for borrowers who had loan types that didn't qualify for relief or had previously consolidated their loans. It also meant that late payments would count.

The Student Borrower Protection Center contends there may still be many people who would qualify for forgiveness but have not yet accessed the benefits of the PSLF waiver. The total number of borrowers who completed the PSLF form hit a new high of 1 million in May, the most recent month with available data. That was nearly double the 536,000 who completed the form before the waiver.

A recently published working paper from the National Bureau of Economic Research similarly points to the possibility that many qualifying borrowers still have not gotten relief through the waiver.

“As many as 3.5 million should be eligible for relief if they file the PSLF waiver. That would amount to approximately $145 billion in debt, compared to the $9.5 billion forgiven thus far.”

While over 146,000 borrowers have gotten relief as of May, co-author of the paper Sara Turner of the University of Virginia wrote that as many as 3.5 million should be eligible for relief if they file the PSLF waiver. That would amount to approximately $145 billion in debt, compared to the $9.5 billion forgiven thus far.

Notable groups to co-sign the letter directed to Biden included the Student Borrower Protection Center, the American Federation of Teachers (AFT), the National Education Association (NEA), the National Consumer Law Center, and UnidosUS.

Some members of Congress also would like to see the PSLF waiver codified. Last May, Sen. Sheldon Whitehouse of Rhode Island introduced the Simplifying and Strengthening Public Service Loan Forgiveness Act, which would make much of the waiver permanent.