How do I qualify?

To qualify for PSLF, you have to make 120 of the right kind of payments on a Direct Loan while working full-time in the right kind of job. The 120 payments need not be consecutive. We provide more detail about the requirements below.

To find out whether your payments qualify, see "How do I track my payments?".


Qualifying loan

Only federal Direct Loans that aren't in default can qualify for PSLF. This includes Direct Stafford, Direct Grad PLUS, Direct Parent PLUS, and Direct Consolidation Loans. If you don't know which type of loans you have, log into "My Federal Student Aid" on StudentAid.gov. If you see "Direct" in the name, it's a Direct Loan. Otherwise, it's not.

If you have other types of federal loans (such as FFEL or Perkins Loans), you can consolidate them into a Direct Consolidation Loan, which would then be eligible for PSLF. (Even if you already consolidated your loans in the FFEL program, you can re-consolidate into a Direct Loan to take advantage of PSLF.) Click here and here for information about the pros and cons of consolidating. If you consolidate online at StudentLoans.gov, check the box in the application that says you're consolidating for the purposes of PSLF.

If your loans are in default, you will have to rehabilitate or consolidate your loans before they can become eligible for PSLF. For information about getting out of default, click here and here.


Qualifying employment

For PSLF, what matters is who employs you, not what you do at work. Here are the types of employment that qualify:

  • Governmental organizations: federal, state, local, or Tribal (for example, government agencies, the military, public schools and colleges, and public hospitals)
  • Nonprofit 501(c)(3) organizations
  • Nonprofit organizations that provide certain types of public services, such as education or health services. See the full list here.
  • AmeriCorps or Peace Corps service


The following types of employment do not qualify:

  • Labor unions
  • Partisan political organizations
  • For-profit organizations

You must be directly employed by a public service organization to qualify for PSLF. If you are employed by a for-profit, private company that works under contract to a public service organization (e.g., a government agency or nonprofit hospital), your employment does not qualify for PSLF.


Full-time

You must be working full-time when you make each of your 120 payments. For PSLF purposes, "full-time" means your employer's definition of full-time or 30 hours per week, whichever is greater.

If you work at multiple qualifying jobs, you can meet the full-time requirement by working a combined average of at least 30 hours per week. In professions such as teaching, annual contracts that include at least eight months of full-time work will be treated as the equivalent of a full year's employment.


Qualifying payments

To qualify for PSLF, your Direct Loan payments must be full, scheduled, on-time monthly payments in a qualifying repayment plan. The required 120 payments don't need to be consecutive, but only payments made after October 1, 2007 count toward PSLF.

Here's what "full, scheduled, on-time monthly payments" means:

  • For the purposes of PSLF, "on-time" means no later than 15 days after the due date. The easiest way to make sure your payments are made on time is to sign up for automatic payments with your loan servicer.
  • Your payment must cover the full amount due, as shown on your bill. You can make multiple partial payments, as long as they add up to the full amount.
  • Your payment must be a "scheduled" payment, meaning that you are required to make a payment that month. This means that you cannot make a qualifying payment while your loans are in "in-school status," the grace period, a deferment, a forbearance, or default.

Although there is no penalty for prepaying your federal student loans, you cannot qualify for PSLF more quickly by making larger payments than you're required to. You can only receive credit for one payment per month, even if you pay extra. Also, if you do pay more than you're required to, there's an extra step you have to take to ensure that your future payments count toward PSLF. Tell your loan servicer not to apply the extra amount to cover future payments but instead to pay down your loan balance. Otherwise, you may not have a scheduled payment the following month and any payment you make that month won't count toward PSLF.

There are special rules allowing borrowers who are AmeriCorps or Peace Corps volunteers to make a single "lump sum" payment that may count for up to 12 qualifying PSLF payments. In July 2016, this will be expanded to borrowers in Department of Defense loan repayment programs.

Payments on Direct Loans under the following repayment plans qualify for PSLF:

  • The 10-year "standard" repayment plan. However, if you stay in that plan for 10 years, you will have paid off your loan completely and there will be nothing left to forgive. To receive any forgiveness under PSLF, you will need to be in an IDR plan for some or all of those 10 years.
  • Payments in any other repayment plan can only qualify if they are equal to or greater than the 10-year standard payment amount.

If you have a Direct Consolidation Loan, payments made through "standard" plans for these loans do not qualify for PSLF unless your total debt when you consolidated your loans was less than $7,500. This is because consolidation loan repayment periods for higher debt borrowers stretch longer than 10 years. If you have a Direct Consolidation Loan, you will have to apply for income-driven repayment or request a 10-year standard plan to start making qualifying payments for PSLF.

Income-Based Repayment and Pay As You Earn are two ways to help keep monthly payments affordable based on your income and family size. Visit the Department of Education’s Repayment Estimator to find out what your payments might be.
 

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