9 expert tips for qualifying for Public Service Loan Forgiveness

How to ace your PSLF application and mistakes to avoid.

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The Public Service Loan Forgiveness (PSLF) Program infamously rejected 99% of the first-round applicants. The main reason? Borrowers had incorrect information on how to qualify. In fact, the Department of Education (DoE) said most could likely meet the requirements in a few years after making a few tweaks. That’s why it’s crucial to continually verify employment and document correspondence if you’re planning on applying for PSLF.

1. Start right away.

While you can’t submit the actual application for PSLF until you’ve made 120 repayments, the process can start as soon as you decide you want to apply for forgiveness. You can begin by checking your eligibility, making a few repayments and submitting your Employer Certification Form (ECF) to double-check your repayments will count toward PSLF.

Applying for PSLF also involves switching servicers, and the sooner you do it, the easier the process will be.

“Some loan servicers aren’t qualifying members,” says Lindsey Conger, an independent college counselor at Moon Prep. “You need FedLoan Servicing to become your loan servicer.”

2. Don’t only rely on your servicer for information.

One of the main reasons PSLF applicants were rejected is because they had wrong information about their eligibility from their servicer. In fact, organizations like the American Federation of Teachers have filed lawsuits against servicers like Navient and the DoE for giving borrowers incorrect information about the program.

That’s why Certified Student Loan Professional (CSLP) at Fish and Associates Kerry Jackson advises borrowers to verify what your servicer tells you.

“Do your own homework,” Jackson says. “If you must call to ask a question, call three times to see if you get matching answers. The stakes are high, often tens or hundreds of thousands of dollars are on the line.”

3. Keep records.

“If applying for PSLF, keep records of your Employment Certification Forms and your number of qualified payments,” says Jackson.

Servicers sometimes make mistakes. Keeping records of your verified repayments can protect you if something goes wrong in the future. You can use it to argue against a rejection, file a complaint against your servicer or — in extreme cases — participate in a lawsuit.

4. Don’t consolidate halfway through.

Consolidating your loans with a Direct Consolidation Loan can be a good move if your loans currently aren’t eligible for PSLF. But if you’re going to consolidate, do it before you get started.

“Consolidating your loans gives you a brand new loan,” says Alyssa Keil, financial coach and founder of FinanciALLY. “So any payments you have already made on your old loans will not be tied to this new loan. You’ll be starting over with zero qualifying payments after consolidating.”

5. Submit your ECF every year.

You can technically wait until the end of your 120 repayments before you file your Employment Certification Forms. But it’s not always advisable.

“Going back that far can be difficult if you’d had multiple jobs,” says Keil. “And if for some reason your employer isn’t an eligible organization, you want to know immediately rather than 10 years later so you can adjust your student loan payoff strategy.”

Wait until the end and you might learn that none of your repayments were eligible.

6. Only make one repayment a month.

In the past, some borrowers interpreted the 120 repayment requirement as any repayment and tried to qualify faster by making multiple repayments in one month. But it doesn’t work that way.

“If you decide to pay more than your monthly payment requires, or pay twice in one month, it won’t help you” Conger says. “You’re still required to hit all 120 payments.”

This can particularly affect borrowers who receive partial student loan forgiveness as an employee benefit, which is often given in one lump sum, once a year. If that’s you, request to have the forgiven amount divided up into monthly installments, if possible.

7. File taxes separately from your spouse.

Since PSLF requires borrowers to enroll in an income-driven repayment plan, how you file your taxes can affect the amount you pay each month. Especially if you tie the knot.

“Married people may want to consider filing separately,” Jackson says. “The income is based on the tax return, so if you file jointly, you’ll be paying a percentage on your spouse’s income.”

8. Save up for retirement or healthcare for lower income-driven repayments.

Depending on your salary and debt load, the income-driven repayment plan can sometimes cost you more each month than other repayment options. But there are ways to reduce this — besides filing a separate tax return from your spouse.

Riley Adams, licensed CPA and founder of Young and the Invested, recommends contributing as much as possible to a retirement plan like an IRA or 401(k).

“This lowers your taxable income and therefore your payment eligible for PSLF under an income-driven repayment plan.” Jackson also suggests making contributions to a health savings account plan if you have a high deductible.

9. Skip PSLF if it’ll cost you more.

Depending on how much you borrow, PSLF might not actually offer the savings the name implies. That’s because interest-driven repayment plans typically don’t cover the full interest that adds up each month, sometimes growing your balance despite your repayments.

“Many people who have or will get balances forgiven under PSLF will primarily be getting the accumulated interest forgiven — not the principal,” Kiel says.

“This means you may pay just as much or more over 120 repayments as someone who pays off the full amount of their loans in 10 years. This is especially true if you didn’t complete the 120 qualifying repayments consecutively. If you have the ability to pay your loans off without PSLF, you absolutely should.”

You can use the student loan repayment estimator tool on StudentLoan.gov to find out how much you’ll actually save with PSLF before you sign up.

6 mistakes to avoid when applying for PSLF

The Department of Education warns borrowers against making these common mistakes, which could get your application rejected:

  • Missing errors on your ECF. Check for missing information and inconsistencies on your form. And if you make corrections, make sure the right person is signing it — either you or your employer.
  • Forgetting to consolidate Parent PLUS, FFEL and Perkins Loans. These loans aren’t eligible unless you consolidate them with a Direct Consolidation Loan. Do it before you start making qualifying repayments to get the most out of PSLF.
  • Enrolling in the wrong repayment plan. You must be enroll in an income-driven repayment plan for a repayment to qualify. However, if you were given bad information from your servicer about repayment plans, you still might qualify for Temporary Expanded Public Service Loan Forgiveness (TEPSLF).
  • Missing the recertification deadline for income-driven repayments. You need to recertify your income each year to qualify for income-driven repayments. Missing the deadline means missing out on repayments that would have otherwise been eligible.
  • Going into deferment or forbearance when you don’t need to. Each month you pause repayments pushes back the date your debt will be forgiven. Only use deferment or forbearance if absolutely necessary.
  • Missing your due date. Repayments that are more than 15 days late don’t qualify for PSLF.

Bottom line

Applying for PSLF is a long and confusing process — and mismanagement from servicers and the DoE hasn’t made it easier. Stay on top of your loans, keep records and verify any information you receive from your servicer before making any changes. Check out our guide to the Public Service Loan Forgiveness Program to learn more about how it works.

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