Forgiveness Program

Understanding Student Loan

Understand which student loans you qualify for, who will give them to you, and how to get them. All it takes is a little research.

  • Stafford loans are the most common federal education loans students receive. They can be either subsidized or unsubsidized.
  • Perkins loans are low-interest federal loans, administered by the school, for students who demonstrate exceptional financial need.
  • PLUS loans can cover expenses not met by other federal financial aid. These can be taken out by dependent students’ parents or by graduate students
  • Consolidation loans combine one or more pre-existing loans into one new loan with a fixed interest rate and (generally) a longer term.
  • Institutional loans are non-federal aid that schools loan their students.
  • Private loans and state loans are not federal aid—however, they can help students ineligible for federal aid or those who do not receive enough aid to cover the cost of attendance.

Who Can Borrow

Students who demonstrate financial need and are:
  • U.S. citizens or eligible non-citizens.
  • Enrolled at least half time in an eligible degree or certificate program.
Loan Limits

Undergraduate independent and dependent students can borrow a maximum of $23,000. This includes:
  • Up to $3,500 in their first year.
  • Up to $4,500 in their second year.
  • Up to $5,500 in their third year and beyond.
As of July 1, 2012, graduate students can no longer receive Federal Subsidized Stafford Loans. They are still eligible for Federal Unsubsidized Stafford Loans.

Repayment Terms
  • Repayment begins 6 months after the borrower initially graduates, withdraws, or drops below half-time enrollment.
  • Under certain conditions, the borrower can request a deferment—a repayment postponement—during which the federal government will pay your accruing interest on your behalf.
  • Borrowers also may be able to postpone repayment of their loan payments with forbearance. However, interest still accrues and will capitalize if you do not pay it during forbearance.
  • Typically, you have up to 10 years to complete repayment; however borrowers can also choose from various repayment plans.
  • There are no penalties for prepayment or finishing repayment ahead of schedule.
For a payment to count as one of the required 120 qualifying payments, you must be a full-time employee at a qualifying public service organization on the date that your federal loan servicer receives your monthly Direct Loan payment.

In addition, you must be a full-time employee at a qualifying public service organization at the time you apply for PSLF Program loan forgiveness and at the time forgiveness is granted.
Because it will take at least 10 years for you to make the 120 qualifying payments necessary to receive PSLF, we have created an Employment Certification for Public Service Loan Forgiveness form (Employee Certification form) that you should submit to process that you should follow so that we can assist you in tracking your periods of qualifying employment and your qualifying payments.

The form allows you to get your employer's certification of employment while you are still employed at that organization or shortly after leaving. The process allows you to receive confirmation of qualifying employment and your Direct Loan payment eligibility. You may also submit the form less frequently than annually to cover more than one year's employment or for more than one employer.

While use of this form and process is not required, if you want us to track your progress toward meeting the PSLF eligibility requirements, you should follow the steps below. If you do not periodically submit the form, you will still be required to submit a form for each employer that you want considered for PSLF at the time that you apply for forgiveness.

  • Step 1 — Complete, with your employer's certification, the Employment Certification form annually or whenever you change jobs.
  • Step 2 — Submit the completed form to FedLoan Servicing (PHEAA), the PSLF servicer, following the instructions on the form.
  • Step 3 — FedLoan Servicing (PHEAA) will review your Employment Certification form, ensure that it is complete, and, based on the information provided by your employer, determine whether your employment is qualifying employment for the PSLF Program.
  • Step 4 — If the form you submit is incomplete or your employment does not qualify, FedLoan Servicing (PHEAA) will notify you and you will have an opportunity to provide additional information.
  • Step 5 — If FedLoan Servicing (PHEAA) cannot determine whether your employment qualifies, you may be asked to provide additional information or documentation to help establish whether you were employed by a qualifying public service organization. This documentation may include an IRS Form W-2, pay stubs, or other documents from your employer that substantiate your employment at the organization or documentation supporting your employer's eligibility as a public service organization.
  • Step 6 — If your employment qualifies and some or all of your federally held loans are not serviced by FedLoan Servicing (PHEAA), those loans will be transferred to FedLoan Servicing (PHEAA) so you will have a single federal loan servicer for all of your federally held loans. After your loans are transferred, earlier payments made to other federal loan servicers will be evaluated to see whether they are qualifying PSLF payments.
  • Step 7 — FedLoan Servicing (PHEAA) will notify you whether your employment qualifies, and, if so, how many payments during the certification period were qualifying payments, the total number of qualifying payments you have made, and how many payments you must still make before you can qualify for PSLF.