PSLF waiver ends October 31, but nonprofit and goverment workers can get a 2nd chance at debt relief

expands eligibility for the Public Service Loan Forgiveness Program

Instead of extending the waiver, the Biden administration is making some permanent changes to the program that will go into effect in July 2023. These moves are separate from President Joe Biden's one-time student loan forgiveness plan, which will cancel up to $20,000 in student loans for low- and middle-income borrowers. That program is currently on hold while a federal appeals court considers a legal challenge to the program.

But the PSLF program has been riddled with problems. Before Biden announced the temporary changes to the program, many borrowers reached 10 years of repayment believing they qualified for cancellation of their remaining debt, but instead found out that they had the wrong kind of loan or were making payments in the wrong kind of repayment plan. In 2019, the US Government Accountability Office found that about 99% of PSLF applications had been rejected.

Under the new rules, time spent in certain periods of deferment or forbearance will count toward PSLF. These periods include deferments for cancer treatment, military service, economic hardship and time served in AmeriCorps and the National Guard. The one-time updates will start in November and are expected to bring many borrowers -- even those who are not public sector workers -- closer to forgiveness.

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