A new “buyback” student loan forgiveness program can help you get debt relief sooner

the Public Service Loan Forgiveness Program It helps eligible teachers and public employees clear their student loan balances after working in the field for 10 years and making 120 qualifying monthly loan payments. However, some PSLF borrowers who were scheduled to receive forgiveness last year may have been frustrated by administrative actions. Payment stopped.

to help, PSLF Buyback Program Provides the opportunity for eligible PSLF borrowers to “buy back” months of nonpayment that did not count toward forgiveness while their loans were in forgiveness or deferment.

The buyback option can help some borrowers get debt relief sooner, but it’s not a shortcut to speeding up your progress toward PSLF, he said. Elaine RubinDirector of Corporate Communications at Edvisors.com. You will need to complete ten years of service and meet other conditions to qualify. If you’re only five years into a teaching position, for example, you can’t use this program to make your remaining five payments to get debt relief now.

Here’s how to find out if you qualify for the buyback program and how to apply.

Read more: 6 moves student loan borrowers should make before the White House moves

What is the PSLF Buyback Program?

The PSLF Buyback Program allows you to buy back some of your skipped payment months to count as eligible payments under PSLF, which can speed up the debt cancellation process for a small number of eligible borrowers.

For example, if you are a teacher who has worked for 130 months in this role, you have already exceeded the 10-year period required to be eligible for public loan forgiveness. But if your student loan is in deferment or contingent for 15 months, you may have only made 115 months of payments. Typically, this means that you are not yet eligible for forgiveness under the PSLF program.

Under the government’s PSLF buyback program, you can now make a payment (either in one lump sum or through multiple payments) within 90 days to cover the five months needed to meet your obligation and obtain debt relief.

How much will you need to buy back? It depends on how many months you have before your 120 goal and the amount of your monthly payment. If you’re on an income-driven repayment plan, your monthly payment could be $0, Rubin said. But if your monthly payment is $200 and you make only 117 payments, you’ll need to pay $600 to complete the buyback.

After you submit a request for a buyback, the government will itemize the total amount you must pay to your provider within 90 days in order to be forgiven of the remaining balance.

Who is eligible to buy back PSLF?

There are several requirements to be eligible for a PSLF buyback:

In other words, you can’t request a buyback if you have less than 10 years of service, and a buyback doesn’t apply to defaulted loans or loans that have been discharged.

You can check your eligible payments for PSLF at StudentAid.gov, the central dashboard for this program. You can view More detailed information about eligibility requirements here.

How do I apply for the PSLF Buyback Program?

here Application steps For PSLF Buyback Program:

1. If you have qualifying work periods that are not reported, submit them using PSLF utility.
2. Wait to review how Modify the number of payments Applies to PSLF credit.
3. Confirm the missing pay months you wish to repurchase and ensure you are approved for eligible work for the same months (see How to Check these months).
4. Submit a buyback request through PSLF Revisited.
5. Wait to hear back from StudentAid.gov regarding the final payout amount.

Robin warns that the app is a little confusing. “Be patient, but make sure you provide your information,” Rubin said.

You can check the status of your order through StudentAid.gov.

Can I apply to buy back PSLF if I am registered with SAVE?

Yes, you can apply to buy back PSLF if you are enrolled in the Value Education Savings Plan. the Save the programan income-driven repayment plan, is considered a type of eligible forbearance under the PSLF buyback.

Payments for SAVE borrowers have been suspended since the summer, so if you’re a PSLF borrower and could get debt relief in the fall or winter, you’re a prime candidate for the buyback program.

How long will the PSLF buyback program remain open?

The PSLF buyback program is currently open, and there is no strict deadline for applications, Rubin said.

However, once you submit your application and know the buyback amount, you have 90 days to make the buyback payment to your loan servicer. If you fail to pay the total amount within this time frame, you will need to start over by submitting a new application.

With the arrival of a new administration to the White House, the long-term fate of the SLF buyback program is unclear. Rubin recommends taking the time now, while the PSLF buyback is still available, to determine if you qualify and submit your application.