Typically, months in forbearance and deferment do not count towards PSLF. However, months during the COVID-19 payment pause (March 2020-September 2023), months that qualify under the IDR Adjustment, and months where loans are being placed on administrative forbearance after the repayment restart will count toward PSLF.
But recent student debt relief efforts gave PSLF borrowers the opportunity to fast-track loan forgiveness by relaxing “qualifying payment” rules. This included allowing some forbearance periods to count toward PSLF and other student loan forgiveness programs.
MOHELA had an issue where they did not notify people of their loans being due within the mandatory 3 weeks. So, they put everyone who was impacted during this time onto administrative forbearance - due to their error. They also put loans into forbearance during the transition.
You will not receive credit toward IDR forgiveness and Public Service Loan Forgiveness (PSLF) for the month(s) covered by the forbearance. If you made or make a payment for the month(s) you are in the forbearance, the amounts paid will go toward satisfying your future payment(s).
Hence, any administrative forbearance at the moment will not count towards forgiveness counts. It could retroactively count if the courts unblock the Biden administration regulations. Federal student loan borrowers have access to a new income-driven repayment plan, the SAVE plan.
Both deferment and forbearance allow you to temporarily postpone or reduce your federal student loan payments. The difference has to do with interest accrual (accumulation). During a deferment, interest doesn't accrue on some types of Direct Loans. During a forbearance, interest accrues on all types of Direct Loans.
If you work in certain public service jobs and make 120 payments on your Direct Loan(s), you may be eligible to have your loans forgiven. If you are a teacher in a low-income school or educational service agency, you may be eligible for Teacher Loan Forgiveness.
Forbearance periods usually last up to 12 months at a time. If you need to pause your payments after the initial forbearance period ends, you can apply to extend forbearance.
Does interest accrue during administrative forbearance? Loan servicers may initiate administrative forbearance because of ongoing litigation, paperwork delays, clerical issues, or global events, such as the COVID-19 pandemic. During this time, interest does not accrue on your student loans.
What student loans are not eligible for forgiveness? Private student loans, by definition, are private and are not eligible to be forgiven.
As of July 1, 2023, you can make progress towards PSLF when: You make a late payment, make several partial payments during the same month (resulting in a total credit of 1 payment for that month), or pay ahead in a lump sum.
If you're pursuing loan forgiveness, any period of deferment or forbearance may not count toward your forgiveness requirements. This means you'll stop making progress toward forgiveness until you resume repayment.
Important: If your employer is a for-profit organization, a labor union, or a partisan political organization, it isn't an eligible PSLF employer regardless of the kinds of public services it might provide.
If you postpone payments with a mandatory residency forbearance but chose to make voluntary payments, your voluntary payments will not count toward Public Service Loan Forgiveness (PSLF) because you will not be enrolled in an eligible repayment plan when participating in a mandatory residency forbearance.
As of July 1, 2024, the PSLF program has successfully transitioned from MOHELA and now is fully managed by ED on StudentAid.gov. For all inquiries surrounding your PSLF discharge and any associated refunds, visit StudentAid.gov.
Forbearance: A period of time during which the borrower is permitted to temporarily cease making payments or reduce the amount of the payments.
In July 2024, AFT sued MOHELA for a wide range of unlawful practices, including illegally executing a “call deflection” scheme to deny service to borrowers who need help.
If you work in certain public service jobs and have made 120 payments on your Direct Loans, you may be eligible to have your loans forgiven. If some or all of your payments were not made on a qualifying repayment plan for PSLF, you may be able to receive loan forgiveness under a temporary opportunity.
Generally, you will get credit towards PSLF and income-driven repayment forgiveness for each month spent in forbearance. You will not earn any credit toward forgiveness programs for months spent in forbearance. You won't face student loan default or delinquency during an administrative forbearance.
The department first implemented the forbearance in August 2024 due to ongoing litigation between the department and seven states challenging the debt cancellation effort's legality. The plan is under an injunction preventing the department and servicers from forgiving loans.
You were either enrolled in the SAVE Plan or about to have your payments lowered under it. A federal court recently blocked the implementation of the SAVE Plan. To comply with the court order and prevent incorrect billing, the Education Department directed MOHELA to place affected borrowers into forbearance.
However, there are also risks in the borrower's inability to satisfy the terms of forbearance, negatively impacting their credit score. Additionally, the payment relief period will continue to accrue even more interest that is to be paid after the period is over.
Additionally, time spent in processing forbearance (up to 60 days) is eligible for PSLF and IDR credit. Processing forbearance will last no longer than 60 days, at which point a borrower may be placed into general forbearance under the terms described for that status.