99% of borrowers rejected again for forgiveness of their student loan
The latest statistics on student loan debt show that over 99% of people who applied for a civil service loan forgiveness were turned down.
Here’s what you need to know and what to do about it.
Student Loan Waiver: Debt Statistics
The US Department of Education published the latest statistics on public service loan forgiveness:
- As of December 31, 2018, 53,749 student loan borrowers have submitted 65,500 public service loan exemption requests.
- Of this total, approximately 58,000 requests were processed. Another 7,200 requests are pending.
- Of this total, over 73% of applications were refused because student borrowers did not meet program requirements. For example, borrowers did not have qualifying student loans, did not make 120 qualifying payments, or did not have qualifying employment.
- Another 25% of public service loan cancellation requests were refused due to missing or incomplete information on the employment certification form.
How many student loan borrowers have been approved for student loan forgiveness?
Approximately 610 applications were approved and 338 borrowers collectively received $ 21.1 million in utility loan forgiveness. In total, only around 640 borrowers received a public service loan forgiveness on the basis of around 132,000 requests processed. It is less than 0.5%.
Discount on public service loans: requirements
It is not as simple as saying that you “work” in the public service. The Public service loan forgiveness program is a federal program that waives federal student loans for borrowers who are employed full time (more than 30 hours per week) in a qualifying federal, state or local public service job or 501 (c) nonprofit job (3) which makes 120 on-time payments eligible.
The requirements can be tricky. Many applications were rejected due to missing or incomplete information, or not meeting program requirements. The most recent data reflects some of the early applicants for the program, which began in 2007 and took 10 years to pay off student loans. Over time, approval rates are expected to increase as more borrowers become familiar with the public service loan forgiveness program.
Here are 4 things to remember:
1. Complete the employment certificate form
You must complete the Certificate of employment form. How often do you have to submit the Certificate of Employment Form for Civil Service Loan Cancellation?
You must submit the employment certification form to the US Department of Education:
- when you start a job in the public service
- when you change employer
- annually to make sure you are on the right track
2. Enroll in a Federal Income-Based Student Loan Repayment Plan
To qualify for the public service loan exemption, you must be enrolled in a federal income-tested student loan repayment plan. Remember that only federal student loans are eligible for the public service loan exemption. You must also make the majority of the 120 required payments while enrolled in a federal student loan repayment plan.
3. Consolidate your federal student loans (if necessary)
Only direct student loans are eligible for the civil service loan exemption. If you have Perkins loans, FFEL loans, or if you borrowed student loans before 2011, you may need to consolidate these federal student loans into a direct consolidation loan. You can consolidate federal student loans through StudentLoans.gov.
4. Refinance your student loans
If you are considering canceling your federal student loans, you still need an action plan for your private student loans. The good news is that you can refinance private student loans and lower your interest rate – even if you are enrolled in a public service loan forgiveness.
This student loan refinance calculator helps show you how much money you can save by refinancing a student loan.
Student loans: 2020 presidential candidates
Some of the 2020 presidential candidates weighed in on the future of student loan cancellation, how to deal with growing student loan debt, and how to pay off student loans faster.
In April, US Senator Warren (D-MA) offers a student loan cancellation plan that would write off the student loan debt of over 95% of borrowers and fully write off the student loan debt of over 75% of Americans with student loan debt.
President Donald Trump offers eliminate the civil service loan forgiveness program, which would have an impact on borrowers who borrow a new student loan after July 1, 2020. In his place, Trump proposed only one an income-driven student loan repayment plan, which would provide waiver of student loans after 15 years for undergraduate student loans and 25 years for graduate student loans.
Other candidates including US Senator Bernie Sanders (I-VT), Mayor Pete Buttigieg (D-IN), US Senator Kamala Harris (D-CA), US Senator Kirsten Gillibrand (D-NY) and d ‘others have offers all from college tuition-free to student loan debt cancellation to student loan refinancing.