By Ryan Velez
This will lead to their student loan debt being completely wiped out, and the forgiven balance not being considered as taxable income. Being freed from these monthly payments leads to a ton of financial opportunities, but Black Enterprise reports that only 1% of potentially eligible borrowers are taking advantage of this opportunity. Why are so many missing out on a life-changing opportunity?
Statistics from the Jobs With Justice Education Fund suggest that the vast majority of borrowers enrolled in loan forgiveness are in government jobs. However, this is only one part of the overarching umbrella of public service. PeaceCorps, AmericaCorps, and many non-profits employees can also qualify. With this said, it’s not as simple as taking a job and getting your loan forgiveness. The aim of the program is to promote full-time work in public service. As a result, you must make 120 consecutive on-time payments before requesting loan forgiveness, and must remain employed at your qualifying employer while you apply, make your payments, and apply for forgiveness.
What is leading to people not using this program? The Department of Education may be to blame partially, not marketing and promoting the program for people to know it exists. In fact, while it was installed in 2007, instructions and a certification for borrowers weren’t produced until 2012. Student loan servicers are not helpful in this regard either.
In addition to not promoting the program to eligible borrowers, when aware borrowers ask servicers to enroll in an alternative payment plan, these servicers do not always follow instructions. The best thing that you can do in these situations is document every transaction you undergo, and make a regular habit of following up to be certain that things you ask for are being done.
If you are working in a non-profit or public business and are thinking about applying, go to the Federal Student Aid website and read the documents Public Service Loan Forgiveness Program and Questions and Answers for Federal Student Loan Borrowers. It’s not a complicated process, but the results could change your financial future for the better, so be sure you take advantage.