Rules relaxed for Public Service Loan Forgiveness program, but not for much longer

CHARLOTTE — Student loans for some firefighters, police officers, teachers and other public servants could be forgiven.

But changes are coming to the Public Service Loan Forgiveness Program that now allows nonprofit and government employees to have their loans forgiven after 120 payments or 10 years.

Inga Carey, a music teacher at a Rock Hill elementary school, is one of the many folks hoping to benefit from the relief.

“Music, I believe, can help you become a better person,” she said. “I like just working with the kids and letting them explore and have fun with music.”

But there’s always this shadow hanging over her: student debt. She told Action 9′s Jason Stoogenke she owed about $90,000 for college and graduate school.

It’s hard to pay back, especially on a teacher’s salary, she said.

“I can’t wait till it’s done, because then I won’t have to have a second job,” she said.

Carey is applying for the Public Service Loan Forgiveness Program, which could erase the entire amount she still owes.

The program requires a person to make 120 loan payments while working full-time in public service. If so, the government will forgive the rest of your student loan.

Carey told Stoogenke it would take her about 30 years to pay off all that money, basically until the day she retired.

“Oh yeah, 100%. If it weren’t for the Public Service (Forgiveness Program), I probably would have gone out of teaching already,” she said.

However, many people say the program is so complex and poorly run that a lot of their payments didn’t qualify -- they didn’t count toward the 120 -- so they had trouble taking advantage of the forgiveness program.

So federal education officials relaxed the rules until Oct. 31, 2022.

Now, you can count your payments even if they weren’t all in full or on time, no matter what repayment plan you were on, and no matter what loan program you were using. That includes the Federal Family Education Loans and Perkins Loans.

Attorneys General across the country -- including North Carolina’s Josh Stein -- are asking President Joe Biden to extend the deadline, so public servants have more time to fill out their paperwork.

“Many North Carolinians who qualify for the Public Service Loan Forgiveness Program haven’t yet applied – because they’re too busy doing exactly what we asked them to,” Stein said in a statement. “They are hardworking teachers, law enforcement officers, firefighters, and other dedicated public servants who spend their days serving their communities.

“I am urging the Biden Administration to extend the waiver so that these folks can have the breathing room they need to fill out their paperwork. I also urge every eligible employer in our state to work with their employees to get this done – we must do everything we can to honor our commitment to these public servants.”

Some people Channel 9 spoke with say it’s not the most user-friendly application process, so, either way, they recommended not waiting to apply.

(ALSO READ: Biden administration proposes changes to ‘broken’ student loan system)

Biden administration proposes changes to ‘broken’ student loan system Among the proposals are new limits on accrual of interest and an easier path to debt forgiveness for public servants. (NCD)

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