Limited Waiver Rejections

About a month ago, on October 6, 2021, the Department of Education announced a limited PSLF waiver (, where all payments by student borrowers would be allowed to count toward PSLF, regardless of loan program or payment plan. Unfortunately, the new program is experiencing some growing pains.

According to NPR, FedLoan Servicing, the official PSLF loan servicer, has been incorrectly rejecting applications of some borrowers who appear to qualify for forgiveness under the new terms…for at least 3 weeks! Richard Cordray, head of the department’s office of Federal Student Aid (FSA), said, “[We] expect our servicers to provide clear, accurate information to borrowers, and we are taking steps to ensure they do so. We have requested information from [FedLoan’s parent company, PHEAA] about any borrower who submitted an application after October 6th and received a response inconsistent with the new program terms. FSA will ensure these borrowers gain the benefits of the new terms to secure the loan forgiveness they have earned.”

In turn, it seems FedLoan Servicing is blaming the Department of Education. Spokesman Keith New from FedLoan Servicing “insists it’s acting properly — that it cannot fully implement the overhaul until the department formally shares detailed plans with its servicers, amends its contract with FedLoan and begins sharing the results of FSA’s own borrower eligibility analyses.” This is in reference to the July PHEAA/FedLoan announcement of non-renewal of its loan servicing contract with the U.S. government.

The Department of Education assures students that they will eventually qualify for the new PSLF Waiver program, giving an estimate that eligible borrowers could begin to see their loans discharged in a matter of weeks.

Tagged with: , , , ,
Posted in blog