Celebrating 10 years! 2007-2017

Less than 1% of PSLF applicants are being approved

https://slate.com/business/2018/09/ public-service-loan-forgi doublefriedchicken09/26/18
https://studentaid.ed.gov/sa/repay- loans/forgiveness-cancell finklebots09/26/18
Something stinks. 99% seems to high for the probable reas superttthero09/26/18
Betsy DeVos impact? fuckyouracists09/26/18
A lot of them probably didn't make payments under a "qualify finklebots09/26/18
Sure, and I'd buy even more than 50% having issues, but 99%? superttthero09/26/18
Not surprised the first generation is having tons of problem irishlaw09/26/18
Yeah, I was in the early wave of graduates who could borrow 6figuremistake09/26/18
Good. Why should taxpayers, especially doc review monkeys, p triplesix09/27/18
Some government jobs pay horribly. In my home state, attorne downwardslope09/27/18
The U.S Bureau of the Census has the annual real median pers triplesix09/27/18
I suspect that the #1 reason for this is that "120 qualifyin onehell09/27/18
They should not be able to change the terms and conditions o qdllc09/28/18
When our forgiveness comes up in 20 years, it’ll crash the fuckyouracists09/28/18
There is no hidden regulation, it fundamentally is as simple onehell09/28/18
Just to be clear, if you're unemployed and on IBR a $0 month david6198309/27/18
For IBR 20 year forgiveness it counts, but of course not for onehell09/28/18
What if one of your payments in the 10 years was late? fettywap09/27/18
Then that one payment doesn't count and you would have one m onehell09/28/18
People need to stop falling for government gimmicks. If it hairypalms09/27/18
180. These are the same folks who believe big government is plumber09/28/18
Fine. Let's downsize government. Throw out the Constitution, finklebots09/28/18
Looks like someone is triggered. "Throw out the Constitut plumber09/28/18
My point is that private concerns can be just a dishonest as finklebots09/28/18
The invisible hand regulates the free market particiapants s triplesix09/28/18
How about opposing concentrating massive amounts of power in professionalloser09/28/18
Anti trust laws are merely a tool of the deep state to preve triplesix09/28/18
Welcome back, 666. We missed thee. Corporate welfare for the fuckyouracists09/30/18
Agree that most people just shouldn't go. But the people who onehell09/28/18
... but, the promissory note won't diffuse the Tax Bomb at t acerimmer09/29/18
There is no tax bomb for PSLF. downwardslope09/29/18
I expect the tax bomb will go away. As already stated it do david6198309/29/18
I’d like to think so as well. The tax bomb is a good part qdllc09/30/18
The solution is simply to forgive the loan after 20 years or david6198309/30/18
The public already hates lawyers. Turning lawyers into deadb acerimmer10/01/18
PSLF is for all borrowers who qualify. qdllc10/02/18
Yes, but lawyers have the biggest debt, the lowest incomes r onehell10/02/18
https://www.cnbc.com/2018/10/02/tip s-from-one-of-the-first-p gw050910/02/18
Without more concrete data I will presume a lot of these deb billcarson10/08/18

doublefriedchicken (Sep 26, 2018 - 10:20 am)

https://slate.com/business/2018/09/public-service-loan-forgiveness-program-applicant-rejections.html

And little information on why.

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finklebots (Sep 26, 2018 - 6:40 pm)

https://studentaid.ed.gov/sa/repay-loans/forgiveness-cancellation/public-service/temporary-expanded-public-service-loan-forgiveness

It looks like the reason for all the initial denials is that an initial denial is required to establish eligibility under TEPSLF.

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superttthero (Sep 26, 2018 - 10:31 am)

Something stinks.

99% seems to high for the probable reasons stated in the article (wrong repayment, wrong job, type of loan).

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fuckyouracists (Sep 26, 2018 - 10:39 am)

Betsy DeVos impact?

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finklebots (Sep 26, 2018 - 11:13 am)

A lot of them probably didn't make payments under a "qualifying payment plan."

It's hard to know if your plan is qualifying when you call in to Fedloan and don't get a straight answer to the question "what payment plan am I in now?"

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superttthero (Sep 26, 2018 - 11:45 am)

Sure, and I'd buy even more than 50% having issues, but 99%? Seems, particularly with no further info?

That's a lot of people, I'd like to see some denial letters.

Wish we still had investigative journalism in this country.

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irishlaw (Sep 26, 2018 - 11:49 am)

Not surprised the first generation is having tons of problems. No advisor probably understood the rules in 2007 thanks to overly complicated regulations.

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6figuremistake (Sep 26, 2018 - 12:03 pm)

Yeah, I was in the early wave of graduates who could borrow GradPLUS to cover the difference between COA and the Stafford loans. All of my loans were eligible for IBR, but it was a nightmare trying to get everything sorted out. I honestly think it took 12 calls to Aunt Sallie to finally have all my loans placed into IBR - after being threatened with collections, being told GradPLUS wasn't IBR eligible, and being forced into repeated forbearances.

The student lenders (and probably the government) had no idea how the program was supposed to work. I'm sure 1) there were all sorts of mistakes made years ago when people entered this program and 2) now that the bill has come due, the government/lenders has no idea how to handle forgiveness - and have no real incentive to make the process easy.

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triplesix (Sep 27, 2018 - 10:46 am)

Good. Why should taxpayers, especially doc review monkeys, provide subsidized education to people with decent middle class or higher income? To ask...

Hopefully, doe can squeeze a few more years of "qualified payments" from these welfare queens.

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downwardslope (Sep 27, 2018 - 11:26 am)

Some government jobs pay horribly. In my home state, attorney jobs start at around $40K and most make somewhere around $50-60K. I had a friend with something like 20-25 years of experience in a very high COL city making just over $60K. I don’t know how that is a lavish salary.

Most people I know who are in the program have problems with forbearance because they take two months to process the forms and then say that the people asked for a “forbearance” even though they were making qualified payments during that time. These are people making plush salaries of between $44K-60K.

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triplesix (Sep 27, 2018 - 11:45 am)

The U.S Bureau of the Census has the annual real median personal income at $31,099 in 2016

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onehell (Sep 27, 2018 - 1:39 pm)

I suspect that the #1 reason for this is that "120 qualifying payments" and "ten years" are not the same thing. Many people probably counted down ten years from graduating, but you get a 6 month grace period. Also, if you're on IBR and recertify income too close to your anniversary date, the servicer will put you on forbearance for a month or two while they figure out your payment, and if you have to get enrolled in IBR and consolidate old FFEL loans too, well, that's more months of forbearance.

2 months of forbearance every year times ten years is 20 months. Add the 6 month grace and ten years after graduation you still have over two years to go. Also, if you consolidate loans (as you must if you have any old FFEL loans, which qualify for IBR but not PSLF) then the default repayment period will not be 10 year standard, they will default you into a nonqualifying extended repayment plan if you don't make a choice.

Point being, a lot of these people being denied may not be just SOL; rather, they may have simply applied too early.

The single biggest thing that could be done is to make it automatic. If your balance is above a certain level when you leave school, then IBR should be the default repayment plan and any FFEL loans you have should be automatically consolidated into a single direct loan, again unless you opt out. And since the DOE already can link to IRS return data, they could just figure out your payment for you unless you affirmatively tell them to use alternative documentation due to a job loss or something.

One thing I have learned from work is that when you have large numbers of people enrolled in anything where they can make choices but where a choice is made for them if they don't act, the vast majority will just take the path of least resistance and go with whatever they are "auto-enrolled" into. So they go into whatever the default repayment plan is, and if they run into trouble making payments the servicer puts them on forbearance with nothing more than a phone call.

Somewhere along the way, someone tells them that if they've worked at a nonprofit or for the government for ten years they can get their loans forgiven so they send in an application without understanding any of this. The servicers are paid per-member per-month so forbearances are great for them, and the schools can't do too much training on IBR during exit counseling because they would be seen as manipulating the system for their own benefit, as we saw with Georgetown Law.

There is a side issue like the ABA case which reveals how few people (servicers included) understand the difference between a 501c3 and other kinds of nonprofits, and those issues will remain regardless. But the single biggest thing we could do is that right out of school it should be opt out, not opt in, to IBR/REPAYE etc. if your balance is above a certain number. In the long term, that's the solution.

Instead, we get stories like this which cause people to avoid the program entirely and pay many thousands more on their loans than they should. Fact is, forgiveness is real and attainable if you do your homework. They should make it easier, but if people get cynical about the program instead and just don't bother with it, that's even worse.

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qdllc (Sep 28, 2018 - 7:48 am)

They should not be able to change the terms and conditions of the plan without conspicuous notice. This program is fairly straightforward. Make 120 payments on time while working either for the government or qualified nonprofit organization full-time, and the balance is forgiven debt-free.

If you are IBR, ICR, or PAYEE, you are supposed to qualify for this program. Having policy or regulations buried somewhere that modifies how this works should be construed against the lender or loan holder as the borrower is relying to their detriment on the plain representations by the lender.

I always borrowed from the government. I’ve always been on ICR or IBR. My consolidation loan is with Department of Education. I work full time for a state agency in a position with no advancement potential. If there is some buried regulation disqualifying all or part of my debt, it should be conspicuously obvious...not hiding in boilerplate kept hidden by the lender.

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fuckyouracists (Sep 28, 2018 - 10:34 am)

When our forgiveness comes up in 20 years, it’ll crash the economy if they don’t do it. They’ll have no choice.

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onehell (Sep 28, 2018 - 2:53 pm)

There is no hidden regulation, it fundamentally is as simple as you describe and based on that description you should be fine.

The difference is that you did your homework. Most people do not research this stuff. They don't understand what repayment plans qualify nor do they understand the difference between a forbearance and a payment that is just calculated to be zero because your income is low. All they know is that they graduated ten years earlier and they've been at a nonprofit or government agency the whole time.

There's a bit more to it than that but as you described, you did those additional things.

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david61983 (Sep 27, 2018 - 7:32 pm)

Just to be clear, if you're unemployed and on IBR a $0 monthly payment still counts towards your 25 years of required monthly payments? I had 3 years of unemployment post law school.

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onehell (Sep 28, 2018 - 2:54 pm)

For IBR 20 year forgiveness it counts, but of course not for PSLF 10 year forgiveness since if you were unemployed you weren't in a regular job.

Just make sure you really on IBR and your payment was calculated at zero based on your income documentation. There's a big difference between not making payments because you are on forbearance, which counts for nothing, and not making payments because you have gone on IBR and documented low or no income.

Whatever you do, never let them put you on forbearance. A $0 IBR payment is a payment. A forbearance is no payments.

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fettywap (Sep 27, 2018 - 9:18 pm)

What if one of your payments in the 10 years was late?

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onehell (Sep 28, 2018 - 2:56 pm)

Then that one payment doesn't count and you would have one month longer to forgiveness. The payments don't have to be consecutive, just cumulative, so you just lose that one month.

Again, it's 120 qualifying payments, not ten years.

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hairypalms (Sep 27, 2018 - 10:27 pm)

People need to stop falling for government gimmicks. If it sounds too good to be true, it probably is. The government can change the rules at any time and leave you holding the bag. Stop relying upon the government to solve your problems. If you can't afford college/law school through traditional funding, you shouldn't go. 2008 - government tells everyone they can and should buy a house. What result? 2012 - government tells everyone they can and should go to college. What result? When are you going to stop falling for these lies?

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plumber (Sep 28, 2018 - 8:59 am)

180. These are the same folks who believe big government is good and altruistic. You would think that anyone who had been duped into these student loans or mortgages would wake up..but they don't. The whole education system was designed to turn us into dumbed-down wage and debt slaves for the rest of our lives. The game's rigged, guys. https://www.youtube.com/watch?v=acLW1vFO-2Q Brainwashed people also believe that government is looking out for theirs and others' interests by opening the borders.. instead of realizing that the purpose is to drive down the cost of labor (i.e., middle class wages). They believe government can and will eradicate climate change with carbon taxes. They think the government was helping "dreamers" from South America by placing them in our communities instead of being complicit in the trafficking of children and opiod drugs.. with the assistance of MS-13.

They never consider that since the mid-1960s, the US Government (liberal order) actively SCAMS, HATES AND DESPISES US citizens!

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finklebots (Sep 28, 2018 - 10:57 am)

Fine. Let's downsize government. Throw out the Constitution, eliminate the military and let the 50 states govern themselves. That's the logical conclusion of your simplistic "All government is bad and untrustworthy" argument isn't it?

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plumber (Sep 28, 2018 - 11:38 am)

Looks like someone is triggered.

"Throw out the Constitution, eliminate the military."

No. Absolutely not.

"..let the 50 states govern themselves."

I do think the states should be able to govern themselves more than they have in the recent past.

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finklebots (Sep 28, 2018 - 12:01 pm)

My point is that private concerns can be just a dishonest as government. Bank of America unilaterally changed the terms of my mortgage and made me buy additional flood insurance. Private Law schools misrepresented their employment and salary statistics. Government entities do not have a monopoly on cheating, lying, and bull**iting.

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triplesix (Sep 28, 2018 - 1:46 pm)

The invisible hand regulates the free market particiapants so we are all good!

Government is only accountable to liberals who hate America.

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professionalloser (Sep 28, 2018 - 2:38 pm)

How about opposing concentrating massive amounts of power into one or a handful of entities, government or private? Can you wrap your little mind around that? I hate Bank of America and Goldman Sachs as much as I hate gov backed student loans and our outrageous military budget.

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triplesix (Sep 28, 2018 - 3:06 pm)

Anti trust laws are merely a tool of the deep state to prevent job creators from generating wealth and sharing the prosperity with their employees. Liberals are paranoid about private sector achieving real results because that would discredit the shady state that they leech off.

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fuckyouracists (Sep 30, 2018 - 10:12 am)

Welcome back, 666. We missed thee. Corporate welfare for the win.

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onehell (Sep 28, 2018 - 2:58 pm)

Agree that most people just shouldn't go. But the people who already went don't have a time machine.

In any case, it is true that congress could pull the plug on PSLF anytime. But IBR is in the promissory note so most experts who have looked at it have agreed that existing borrowers would be grandfathered out of any plug-pulling on IBR as a matter of contract.

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acerimmer (Sep 29, 2018 - 6:34 pm)

... but, the promissory note won't diffuse the Tax Bomb at the end of IBR.

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downwardslope (Sep 29, 2018 - 7:20 pm)

There is no tax bomb for PSLF.

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david61983 (Sep 29, 2018 - 8:48 pm)

I expect the tax bomb will go away. As already stated it doesn't exist for PSLF.

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qdllc (Sep 30, 2018 - 8:14 am)

I’d like to think so as well. The tax bomb is a good part of why underwater loans aren’t being paid back.

If you can do math, you would see that it’s cheaper to pay off the income tax for forgiven debt than to try to pay down the debt itself. Get rid of the tax bomb, and you can require a higher percentage of disposable income to go to repayment because it will eventually come to an end.

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david61983 (Sep 30, 2018 - 9:21 am)

The solution is simply to forgive the loan after 20 years or whenever the principal balance is repaid whichever comes first. Do away with the interest and tax bomb. Along with of course much stricter lending standards.

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acerimmer (Oct 1, 2018 - 10:42 pm)

The public already hates lawyers. Turning lawyers into deadbeats who don't pay their debts isn't going to help the reputation of the profession.

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qdllc (Oct 2, 2018 - 9:15 am)

PSLF is for all borrowers who qualify.

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onehell (Oct 2, 2018 - 10:15 am)

Yes, but lawyers have the biggest debt, the lowest incomes relative to that debt, and they are the ones most likely to take the time to figure the program out. It all adds up to them getting the headlines and since many people still somehow think all lawyers are rich and contribute nothing of value to society, the whole thing starts getting referred to as an abuse of a "loophole" that was intended for the truly "worthy" people such as elementary school teachers, whose debt loads are so much less that if they see any forgiveness at all, it will likely be for just some of the interest rather than the frighteningly large writeoffs you could see with lawyers after 10+ years of negative amortization and capitalizing interest on a six-figure balance.

Lawyers should be the last people speaking publicly about this program. Their use of it needs to fly under the radar so people think it's just 30k writeoffs for public school teachers and stuff.

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gw0509 (Oct 2, 2018 - 10:15 am)

https://www.cnbc.com/2018/10/02/tips-from-one-of-the-first-public-servants-to-get-their-student-loans-erased.html

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billcarson (Oct 8, 2018 - 8:59 am)

Without more concrete data I will presume a lot of these debtors failed to do any certification and MANY simply applied for forgiveness regardless of where they worked or for how long. There was someone fully employed as a judge’s judicial clerk on this forum applying for SSDI. There is a lot of that crap in any “guvahmint gimme” program


Boogeyman pieces like this are effective at spreading panic to the ignorant. Seldom will the critical thinker enjoy this type of journalism.

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