Student loan forgiveness for public servants will be enhanced.
By The Exchange Team
This program, signed into law by then-President George W. Bush in 2007, cancels federal student loans after 10 years or 120 payments.
According to the CFPB, 25% of American workers may be eligible. But The program's problems make actual recipients rare.
1. Payments will eventually resume
:- Experts say borrowers should expect another bill. The pause doesn't affect your qualifying payments.
What borrowers can expect?
2. You’ll get a new servicer: MOHELA
:- As FedLoan's federal contract expires. MOHELA will be your new servicer.
3. New qualifying payment regulations
:- During deferments or forbearances, public servants' payments may be counted. Currently, This doesn't qualify.
4. Deadline for a second chance at relief
:- Borrowers who were disqualified from debt cancellation for public servants can have their timelines recalculated.
5. Broader forgiveness may be ineffective
:-Most borrowers pursuing PSLF are on an income-driven repayment plan, with their monthly bill based on earnings.