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Educational debt looms over most early-career members of the osteopathic community and represents a major stressor for many residents. Public Service Loan Forgiveness (PSLF) is a frequently pursued means to alleviate some of that burden. Are you up to date on all things PSLF?
PSLF is a government program in which the remaining balance of your student loans are forgiven after you have made 120 qualifying monthly payments while working for an eligible government or not-for-profit employer. For many residents, their residency program qualifies them as an eligible employer. Only federal “Direct Loans” are eligible. The 120 months of payments do not have to be consecutive.
There has been a lot of confusion as COVID forbearance ends, and many borrowers have experienced erroneous charges or payment plans. If this has happened to you, you are entitled to a three-month forbearance without interest, which can still count toward forgiveness. If this situation applies to you and this relief has not been offered, contact your servicer.
There is a new program allowing borrowers to shorten their timetable if they have previously been in forbearance or otherwise had periods without qualifying payments. The PSLF Buyback Program allows borrowers to make appropriate payments for these missed periods. See more on the Federal Student Aid website.
Income Driven Repayment (IDR) is an opportunity to minimize the monthly payment on student loans while still counting toward PSLF, and therefore is an opportunity for many to maximize their forgiveness benefit. IDR payments are determined by your tax returns, and your tax strategy can heavily influence what you pay. Check out tax tips from Student Loan Professor.
The PSLF program can be somewhat difficult to navigate, and historically some servicers have not always acted in good faith. Student Loan Professor (Doctors Without Quarters) offers a 25% discount on their loan advocacy and support to AOA members. Find out more on the Student Loan Professor website.