Democrats: Extend Public Service Loan Forgiveness Waiver

• The Public Service Loan Forgiveness waiver deadline is set to expire Oct. 31.
• More than 100 congressional Democrats on Monday sent a letter to the secretary of education asking for an extension of the deadline.
• The letter says that as many as 7 million more borrowers may be eligible for debt forgiveness.

More than 100 U.S. Senate and House Democrats on Monday asked Education Secretary Miguel Cardona to extend the Public Service Loan Forgiveness (PSLF) waiver deadline until at least July 1, 2023.

The temporary waiver that has granted total student loan relief to thousands of borrowers is set to expire Oct. 31.

With the deadline weeks away, more than 100 congressional Democrats led by Sen. Bob Menendez of New Jersey sent a letter to Cardona asking that the deadline be extended "in order to ensure that all public servants with federal student loans are able to benefit from this historic waiver."

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 income-driven repayment (IDR) plan.

PSLF was instituted in 2007, but only a small percentage of borrowers qualified in practice — 16,000 as of September 2021, according to an analysis from the Student Borrower Protection Center. The Education Department (ED) announced the limited waiver in October 2021, and lawmakers, in their letter, said that PSLF had helped more than 164,000 achieve some debt forgiveness.

Millions May Still Be Eligible for PSLF

In the letter, Democratic lawmakers lauded the limited PSLF waiver for having improved the lives of those public servants who have had their student loans forgiven.

"To date, the waiver has been overwhelmingly successful in reducing barriers for borrowers to receive PSLF relief — accounting for almost all (89%) of the borrowers who have received forgiveness through the PSLF program through June 30, 2022," lawmakers wrote.

“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 income-driven repayment (IDR) plan.”

However, additional action is needed to ensure public servants — who have been on the frontlines of the COVID-19 pandemic and recovery — can access the PSLF waiver, lawmakers said. Only 1.3 million out of 9 million potentially eligible borrowers have participated in the program. Extending the waiver would give military service members, federal employees, and other public service workers, especially those in healthcare and education, more time to make steps toward PSLF.

They also asked ED to conduct outreach to increase awareness of the waiver and correct misinformation from student loan servicers.

"For many borrowers, the Department's one-time review to fix forbearance and deferment failures, scheduled for later this year — potentially after October 31, 2022 — may be the first time that they learn that certain periods of deferment and forbearance could count toward both income-driven repayment (IDR) and PSLF programs," the lawmakers wrote. "… For many public servants, losing access to the PSLF waiver before they are able to benefit from the IDR payment adjustment could prevent them from being able to pursue forgiveness under PSLF."

An Ongoing Effort to Extend PSLF Waiver

This is not the first time advocates have asked the federal government to extend the PSLF waiver.

In July, 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 PSLF waiver, as well as the IDR plan waiver.

"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 July 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."

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. He also signed the letter sent to Cardona on Monday.