The Biden administration has announced a pause in the processing of student loan forgiveness under the Public Service Loan Forgiveness (PSLF) program in order to transition the operations to the Department of Education’s own platform. This move comes after the Education Department took over several student loan forgiveness programs from contracted loan servicers due to concerns about inadequate servicing and billing practices. The transition is expected to last from May to July of this year, during which time borrowers will not receive discharges for their loan forgiveness applications.
The PSLF program has seen significant reforms under the Biden administration, resulting in hundreds of thousands of borrowers getting approved for loan forgiveness. The transition to the Education Department’s StudentAid.gov portal was long planned and is aimed at improving the efficiency of the program. While the processing of student loan forgiveness applications will be paused during the transition period, borrowers can still submit their PSLF employment certification forms online using the PSLF Help Tool.
Borrowers should be prepared for changes in their loan servicer during this period as well. MOHELA, the current PSLF loan servicer, has been accused of inadequate servicing practices and will be transitioning out as part of the changes. The Education Department expects that once the transition is complete in July, all information on PSLF, including payment counts and application tracking, will be accessible to borrowers via StudentAid.gov. Additionally, other forgiveness programs, such as TEACH Grants and Total and Permanent Disability discharges, will also have their processing suspended during the transition.
The suspension of student loan forgiveness processing is expected to last three months, with the PSLF program essentially on pause during this time. Borrowers will not be able to access their PSLF progress, certified employment, or payment counts through MOHELA’s borrower portal, and updates to payment counts will not be made during the processing pause. Borrowers are advised to save screenshots and correspondence for their personal records and should expect their servicer to possibly change during this transition period.
While the suspension of processing for student loan forgiveness may cause inconvenience for borrowers, the Education Department is working to streamline and fully manage the PSLF program through its own platform to improve efficiency and service. Once the transition is complete, borrowers should have improved access to information and tools related to their student loan forgiveness applications. In the meantime, borrowers are encouraged to continue submitting their forms and certifications as usual, with the assurance that their applications will be processed once the transition period ends in July.
