November 16, 2017

Whitehouse, Kaine Introduce Bill to Help Forgive Student Loans for Public Service Workers

Legislation would relieve a major financial burden for borrowers tripped up by technicality in Public Service Loan Forgiveness program

Washington, DC – Senators Sheldon Whitehouse (D-RI) and Tim Kaine (D-VA) introduced a bill today to fix a glitch in a federal loan forgiveness program that can leave teachers, soldiers, social workers, and other public servants with massive loan balances they thought would be forgiven after years of payments.  Whitehouse and Kaine’s legislation would relieve a significant financial burden for middle-class families who sought to use the Public Service Loan Forgiveness Program (PSLF) program, which helps those in public service to discharge their student loan debt.  Representatives Brendan Boyle (D-PA), Ryan Costello (R-PA), John Sarbanes (D-MD), and Brian Fitzpatrick (R-PA) have introduced the bipartisan bill in the House.

Congress established the bipartisan loan forgiveness program in 2007 to help teachers, social workers, military personnel, and other critical public service workers pursue sometimes lower-paying careers serving their communities without facing decades of crippling loan payments.  The program allows borrowers to erase the balance of their student debt if they spend 10 years working for a nonprofit or government employer and make 120 qualifying loan payments.  Due to a lack of consistent and clear guidance from loan servicers and complicated program requirements, some borrowers believe they are making qualifying payments under the program when they are not. 

“It’s time to address this bug in the program that can unfairly penalize borrowers,” said Whitehouse.  “A technicality, and the confusion it’s caused, is costing those in public service and their families money and stress.  Upstanding borrowers have been making on-time payments for years that are adding up to little or no progress toward loan forgiveness.  My bill would ensure that those borrowers get credit for their good-faith payments, and for their service to their communities.”

“The Public Service Student Loan Forgiveness program was set up to draw our country’s brightest minds to careers that serve their communities and benefit all of us. There is no reason why we shouldn’t fix confusion around a provision in the program that could leave Virginia teachers, social workers, nurses, and servicemembers shouldering the crushing weight of student loan debt after we promised them a fair trade for their time and commitment. We have to make sure borrowers who believed they were making proper payments actually get the credit they deserve,” Kaine said.

Whitehouse and Kaine’s bill would allow loan forgiveness for public service borrowers who ended up in the wrong repayment plan.  If borrowers had been making payments that were as much as they would have paid on a qualifying repayment plan, they would receive full credit for those payments toward loan forgiveness.

Whitehouse and Kaine’s bill has been endorsed by the National Education Association and the American Federation of Teachers. 


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