Does Working at a University Qualify for PSLF?
Navigate Public Service Loan Forgiveness as a university employee. Understand eligibility, certify employment, and apply for student loan forgiveness.
The Public Service Loan Forgiveness (PSLF) program offers a path to student loan forgiveness for individuals dedicated to public service. Established in 2007, this federal program is designed to encourage careers in government and non-profit sectors by forgiving the remaining balance on eligible federal student loans. To qualify, borrowers must meet specific criteria related to their employer, the type of loans they hold, their repayment plan, and the number of qualifying payments made.
Qualifying University Employers
Working at a university can qualify an individual for PSLF, depending on the institution’s organizational structure. The program recognizes employment with U.S. federal, state, local, or tribal government organizations, as well as qualifying not-for-profit organizations. Public universities, including state-run colleges and community colleges, are generally considered government entities and therefore qualify as eligible employers for PSLF.
Private universities can also qualify, provided they are tax-exempt organizations under section 501(c)(3) of the Internal Revenue Code. Conversely, employment at for-profit universities does not count towards PSLF, regardless of the specific role or services provided. To verify an employer’s eligibility, individuals can use the PSLF Help Tool on the Federal Student Aid website or inquire with their university’s human resources department about its tax status or Employer Identification Number (EIN).
Employment and Loan Eligibility Requirements
Beyond employer eligibility, individuals must meet specific employment and loan criteria to qualify for PSLF. Full-time employment for PSLF purposes is generally defined as working at least 30 hours per week, whether for one qualifying employer or a combination of multiple qualifying part-time jobs. This 30-hour threshold applies even if an employer defines full-time differently.
Only loans received under the William D. Ford Federal Direct Loan Program are eligible for PSLF. This includes Direct Subsidized, Unsubsidized, PLUS, and Consolidation Loans. If a borrower has other federal loan types, such as Federal Family Education Loan (FFEL) Program loans or Federal Perkins Loans, they must consolidate them into a Direct Consolidation Loan to make them eligible. Payments made on the original FFEL or Perkins loans do not count toward the 120 qualifying payments, only those made on the new Direct Consolidation Loan.
Borrowers must also be enrolled in a qualifying repayment plan while making their 120 payments. The most common qualifying plans are Income-Driven Repayment (IDR) plans, which include Income-Based Repayment (IBR), Income-Contingent Repayment (ICR), Pay As You Earn (PAYE), and Saving on a Valuable Education (SAVE) plans. Payments made under the 10-year Standard Repayment Plan also qualify. However, since the 10-year Standard Repayment Plan typically repays the loan in full after 120 payments, borrowers pursuing forgiveness often switch to an IDR plan to ensure a remaining balance at the end of the 10-year period.
Certifying Your Employment
To effectively track progress towards PSLF, borrowers should regularly certify their qualifying employment. The Public Service Loan Forgiveness (PSLF) Employment Certification Form (ECF) serves this purpose. Submitting this form helps the loan servicer confirm that the borrower’s employer is eligible and tracks the number of qualifying payments made.
The PSLF Help Tool on the Federal Student Aid website assists borrowers in generating the ECF and confirming employer eligibility. After generating the form, borrowers must obtain a signature from an authorized official at their employer, typically someone in the human resources department, who can certify their employment records. The completed form is then submitted to the loan servicer, MOHELA, which manages the PSLF program. It is highly recommended to submit the ECF annually or whenever changing employers to ensure accurate tracking of payments and employment periods and prevent issues when applying for forgiveness later.
Applying for Forgiveness
Once a borrower has made 120 qualifying monthly payments while working for a qualifying employer and meeting all other program requirements, the final step is to apply for loan forgiveness. This involves submitting a separate Public Service Loan Forgiveness (PSLF) Application. This application can be found on the Federal Student Aid website.
The application requires detailed information, much of which should have been consistently tracked through regular submission of the PSLF Employment Certification Forms. Borrowers will need to provide their personal details and confirm that they have met the 120 qualifying payment requirement. After completing the application, it must be submitted to the loan servicer.
Upon submission, the loan servicer will review the application to confirm all eligibility criteria have been met. This review verifies the 120 qualifying payments and employment with a qualifying employer at the time of submission. The servicer will then notify the borrower of the decision regarding their PSLF application.