Communication, awareness, and enrollment are key to highlighting program for government and non-profit employees with student loans
The Illinois Department of Financial and Professional Regulation (IDFPR) announced on Aug. 2, 2022, that the Department has issued a letter to all federal student loan servicers encouraging them to immediately implement best practices to help alert and educate eligible student loan holders about the Public Service Loan Forgiveness (PSLF) program. As the primary contact for many student loan borrowers, servicers are in the best position to increase awareness about PSLF and help borrowers take advantage of the program.
PSLF forgives the remaining student loan balance of full-time government and certain non-profit employees after making 120 qualifying payments. In order for more borrowers to qualify for forgiveness, President Joe Biden announced temporary changes to the program, including waiving some past requirements. However, many borrowers are unaware of these changes and may miss out on loan forgiveness as a result. The temporary changes expire on Oct. 31, 2022.
While there are 359,728 public service workers in Illinois with student loan debt, only 4,800 have had their debt canceled to date through the PSLF program. IDFPR’s letter to servicers outlines best practices, such as proactive communication to borrowers, updated training to customer service representatives, and placing notices on their website in order to ensure more Illinoisians receive loan forgiveness based on their public service.
“Alleviating student loan debt and protecting borrowers are top priorities of the Pritzker Administration and IDFPR,” said Mario Treto, Jr, Secretary of the Illinois Department of Financial and Professional Regulation. “In the case of PSLF, too many borrowers have been denied or not told about the benefits of the program. We want to work with the loan servicers to fix this problem.”
A copy of the letter can be viewed by following this link.
For more information regarding PSLF and the temporary changes, please visit: https://studentaid.gov/pslf/.