In 2013, the Consumer Financial Protection Bureau estimated that one-quarter of American workers could be eligible. However, the program has been plagued by problems. The bureau has since found that student loan servicers delay or deny borrowers access to the program by failing to provide them with accurate and complete information about its requirements.
As a result, many people in public service jobs believe that they’re paying their way to loan forgiveness only to discover at some point in the process that they don’t qualify for one technical reason or another. Often, their loan type or repayment plan was ineligible.
The Education Department recently released data on how many borrowers’ loans it has forgiven under the program — just 206. More than 41,000 people have applied.
The new legislation would make all federal loans eligible for the program. Under the current law, borrowers in the Federal Family and Education Loan (FFEL) Program do not qualify.
In addition, all federal repayment plans would be eligible for the relief. There are some 14 ways to repay your student loans, but to qualify for public service loan forgiveness you currently need to be enrolled in one of the four income-based programs.