The Education Department is set to halt all student loan forgiveness processing for a key group of borrowers beginning next week as part of an effort to transition the Public Service Loan Forgiveness (PSLF) program to a new servicing platform. The program, which requires 120 qualifying payments over a period of time, can potentially wipe out federal student loan debt for eligible borrowers who work for qualifying nonprofit or government organizations. However, with the transition, all PSLF processing will be stopped starting on May 1, impacting borrowers pursuing loan forgiveness under the program.
During the pause, which is expected to last until July, the Education Department will not process any PSLF employment certifications, approve student loan forgiveness under PSLF, or update PSLF qualifying payment counts. Additionally, borrowers will lose access to their PSLF data, including tracking information accessible through MOHELA accounts. Once the transition to StudentAid.gov is complete in July, borrowers will regain access to their PSLF data through the new platform, but delays are expected in processing loan forgiveness applications.
While borrowers can still submit PSLF employment certification forms during the pause, none of these forms will be reviewed during the transition period, leading to potential delays in the approval of student loan forgiveness. The Education Department and advocacy groups are warning borrowers to anticipate substantial processing delays once the PSLF processing resumes in July, potentially resulting in further setbacks in loan forgiveness approvals and updates to PSLF qualifying payment counts.
Because borrowers will lose access to their PSLF records during the transition, the Education Department and advocates are advising borrowers to download and save their PSLF tracking information accessible through their online MOHELA account before May 1 to mitigate the potential disruptions in student loan forgiveness processing. Advocacy groups also anticipate errors in PSLF tracking after the transition, which may impact the eligibility for student loan forgiveness or delay approvals, especially as the department works on completing the related IDR Account Adjustment initiative.
As part of the transition to StudentAid.gov, MOHELA will no longer be the sole PSLF loan servicer, and borrowers may see a change in their loan servicer as a result of the transition. The department may transfer some accounts from MOHELA to other loan servicers in the future, so borrowers are advised to ensure their contact information is up to date with both their loan servicer and the Department of Education on StudentAid.gov. Despite the processing pause, borrowers are reminded to continue making their monthly student loan payments as required during this time to avoid any negative repercussions.
Overall, as the Education Department prepares to transition PSLF servicing to a new platform, borrowers pursuing student loan forgiveness under the program are encouraged to be proactive in managing their PSLF data and to stay informed about potential changes to their loan servicer. While delays are expected during the processing pause, borrowers should continue to meet their payment obligations to avoid any negative consequences.
