You know just how many factors go into a person’s health: family history, diet, exercise, environmental factors…the list goes on. There are other influences that may not so readily come to mind, but researchers are continually finding links between different stressors in our lives and their impact on our health. One that you may not have thought about before, but is receiving more and more attention: student loans.
You know just how many factors go into a person’s health: family history, diet, exercise, environmental factors…the list goes on. There are other influences that may not so readily come to mind, but researchers are continually finding links between different stressors in our lives and their impact on our health. One that you may not have thought about before, but is receiving more and more attention: student loans.
If you’re been pursuing PSLF for years and think you’re finally ready to apply for forgiveness, you’ve actually already gone through the steps, you may just not have known it!
Over the past year or so, we’ve seen a lot of positive movement on student loans. President Biden campaigned on student loan reform, and after years of growing national student debt, it seems like we’re finally seeing progress. While some are still eager to see sweeping student debt cancellation, let’s not ignore some of the major reforms that we’ve already seen
Under the recently announced Limited Waiver Opportunity for PSLF, FFEL borrowers have an opportunity to pursue PSLF without restarting the clock. As long as the other conditions for PSLF were met—full-time employment at a public service organization like a 501(c)(3)—previous payments made on FFELs will count towards PSLF as long as they are consolidated before October 31, 2022 and submit the appropriate employment paperwork.. Finally, borrowers under this orphaned loan program will be able to enjoy PSLF without the added hurdle of 10 extra years of repayment.
Report after report has shown that majority Black- and Latinx-communities to bear the greatest burden of student debt and its effects. In 2015, the CFPB documented the effects of the Great Recession on student debt in communities of color, “with many families seeing their net worth nearly cut in half.”
Oftentimes, we and our clients have to correct mistakes made by loan servicers, and having your payment plan messed with can be one of the most detrimental. If your loan servicer tells you that you no longer qualify for your plan, they’re wrong. When you enroll in an IDR plan, it’s “‘til death do you part,” or—to put it in a more positive light—“‘til PSLF do you part.” Have no fear, give us a call, and we’ll help you ride the cap all the way there.
For those pursuing PSLF, they’ve had the added benefit that these months of forbearance have counted toward their 120 qualifying payments required for forgiveness. The economy, however, remains fragile, and many are wondering what will happen as student payments resume in the coming months—not to mention the end of expanded unemployment benefits for millions of Americans.
So what’s the solution? Where do we go from here?
Studies have shown a strong correlation between debt and anxiety, especially student debt. Greater debt tends to be reflected in a greater amount of anxiety, which hits folks like physicians—who already have high-stress, demanding jobs—especially hard. Couple that with the added catastrophic strain of a pandemic on healthcare professionals and you’ve got a one-two punch to your mental health.
So what’s the solution? Where do we go from here?
When Congress passed the CARES Act in 2020, it placed all federally-owned student loans in forbearance, freezing all payments, interest accrual, and income recertifications. That means if you have Direct, Perkins, PLUS, FFEL, or HEAL loans owned by the Dept. of Education, they’re on hold until the end of September 2021. Any privately-held loans, unfortunately, do not count.