Proposals from the White House and Now the Senate, Too

While blanket student loan cancellation is getting all the media attention right now, there’s much more happening behind the scenes, especially as the federal government looks to revamp Public Service Student Loan Forgiveness. We’ve written previously about steps the Department of Education has taken towards student loan reform, and further progress they hope to make, but now it appears that the Senate may look to make some improvements of their own. 

The PSLF program was created by Congress in 2007, but—since then—they’ve left practical concerns to the Dept. of Ed. to implement. Now, Congress may be poised to expand and simplify the existing PSLF legislation, which could broaden its availability to borrowers and shorten the amount of time to achieve. 

The Simplifying and Strengthening PSLF Act

The proposed act—from two Democratic senators (RI & OR)—would expand PSLF in several ways, but would also halve the time it takes borrowers to get their student loans forgiven. It would:

• Lower the number of required qualifying payments from 120 to 60.
• Allow payments made under previously non-qualifying plans, regardless of loan type, or if it was on-time and in full—similar to the current Limited Waiver Opportunity.
• Count payments made while in the Peace Corps or active military service towards PSLF. 
• Allow borrowers with Parent PLUS loans or FFELs to consolidate them into a Direct Loan and qualify for PSLF—also similar to the current Limited Waiver Opportunity.

This bill, however, has a long way to go before it can become law. If you have any questions about how to best manage your student loan repayment until then, we’re always here to help!