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Public Service Loan Forgiveness

September 12, 2011

Public Service Loan Forgiveness

Public Service Loan Forgiveness

First off, being that only loans under the Direct Loan Program as well as consolidated direc loans can qualify for Public Service Loan Forgiveness, if you have loan that isn’t a direct loan, then click here: Public Service Loan Forgiveness as this link will introduce you to Income Based Repayment (IRR) which can help you out more.

If in fact you do have a loan under the Direct Loan Program, Public Service Loan Forgiveness can be used on your loan debt. Public Service Loan Forgiveness which was established in 2007 under the College Cost Reduction and Access Act is when you work a job in the public service profession and make on time payments for 120 non taxed payments, or 10 years, and at the end of this 10 year term whatever is left on your student loan debt total will be wiped away and you will have a clean slate.

Qualifying loans include; Subsidized and Unsubsidized Stafford Loans, Direct PLUS Loans, as well as federal direct loans that are consolidated. NOTE: If you have a Perkins Loan, they can become eligible by consolidation under the Direct Student Loan Consolidation program, the same also applies to Parent PLUS Loans.

Public Service Loan Forgiveness Payment Options

In order to be able to participate in Public Service Loan Forgiveness, you must make payments through the following repayment methods:

  • Income Based Repayment Plan – This plan allows one to pay according to a percentage of their income, usually 15 percent as well as how big their family size is.
  • Income Contigent Repayment Plan – Very similiar to Income Based Repayment Plan.
  • Standard Repayment (Or any direct loan program equivalent) - This is where you pay payements that are enough to pay your loan off in 10 years.

Public Service Loan Forgiveness Qualifying Jobs

  • Government Organization (federal, private or state)
  • Children service agencies or family service agencies.
  • Certiani non profit jobs which need to be part of the Internal Revenue Code.
  • Tribal colleges as well as universities.
  • Services that include the following: Miltary, saftey of the public, law enforcement, law services of public interest, library jobs both public as well as in schools, education in public schools, health care services as well as emergency management. Jobs that are in low income areas where your services are needed most will most likely but eligible for Public Service Loan Forgiveness.

Publice Service Loan Forgiveness Conclusion

Publice Service Loan Forgiveness is great for people who have just gotten out of college and are looking to get into a job that qualifys for forgiveness. If you have been out of college for some time and have paid off some of your debt, it is probably a good option to not try for Publice Service Loan Forgiveness as you won’t be able to enjoy the maximum benefits of the program, the Income Based Repayment will be a better option for you. If you have high debt and are fresh out of college, then the program can save you thousand of dollars and many years of repayment.

If you are interest in participating in Public Serive Loan Forgiveness, contact your student loan lender directly who will give you infomration on what jobs can apply to you and how you can get started.