Spotlight on Student Loans:

Qualifying for Loan Forgiveness the Easy Way: The PSLF Help Tool

Filing out the PSLF help tool

Employment Certification in the “Olden Days”

When Public Service Loan Forgiveness was created in 2007, lawmakers decided that borrowers would be eligible based on what sort of employer they worked for. The broadest groups that would qualify were employees of federal, state, or local government agencies,  tribal organizations, the military, and 501(c)(3) tax-exempt nonprofit organizations.

Although the original text of the law simply stated that borrowers had to have a “public service job” to receive forgiveness, the Department of Education interpreted the law more strictly to favor the organizations above.

To better determine if their employment qualified a borrower for PSLF, the Dept. of Ed. later implemented the Employment Certification Form (ECF) in 2012. For simplicity, it is the same form that borrowers submit when they’ve completed their 120 qualifying payments in order to receive PSLF—a fact that sometimes leads to confusion. Borrowers would download, print off, fill out the form, and mail or fax it to FedLoan (the only loan servicer that managed loans for those pursuing PSLF). Like many government forms, it was (and still is) mostly definitions and legalese, which left many borrowers confused and overwhelmed.

The PSLF Help Tool: A Better Approach to Employment Certification

2017 should have been a great year for PSLF as the first round of borrowers to qualify received PSLF, but it yielded dismal results with less than 2% of applicants actually seeing their loans forgiven. Besides misdirection and negligence on the part of servicers, borrowers were stymied by the arcane paperwork: either misunderstanding whether they qualify, what paperwork to file in the first place, or not filling it out correctly. Attempting to improve outcomes, the Dept. of Ed. created the PSLF Help Tool, designed to guide borrowers through the steps of determining if their employment qualified them for PSLF, making sure they’re on the right repayment plan, and filling out the ECF properly.

The beauty of the PSLF Help Tool is that it guides you through each stage of the process to apply for PSLF. It even gives you good advice about how to use it to track your progress, the same advice we give our clients: submit every year so you can keep an eye on your qualifying payments. Besides the Help Tool itself, the Dept. of Ed. has a handy guide for using it, which guides you through each step with pictures and helpful advice. It also tells you what you need to have to start, some troubleshooting if you’re having difficulty locating your employer in their database, and how to read the information you get after your form is submitted.

PSLF still isn’t perfect, and the Help Tool doesn’t take care of all the kinks in the system, but it’s a big leap forward from the dark ages of paper forms, ballpoint pens, and fax machines.

If you’re pursuing Public Service Loan Forgiveness and you haven’t met with us yet, schedule your free 15-minute Discovery Session to find out if you qualify for PSLF, or what you can do if you don’t.