US loan forgiveness program is underused; public service lawyer expects to save thousands
Posted Sep 12, 2013 11:00 am CDT
A new tool kit for employers aims to increase awareness about the Public Service Loan Forgiveness program, available to those who work for nonprofits and government.
The Consumer Financial Protection Bureau created the summary (PDF) of benefits, the New York Times reports. The program forgives unpaid balances on federal direct student loans after 10 years of work for the government or nonprofits. The program works when borrowers pay less than the standard payment during those 10 years, usually through other programs that lower loan payments for those with lower salaries.
According to the Times, complex and sometimes conflicting benefits have resulted in underuse of the Public Service Loan Forgiveness program and other repayment assistance.
Lawyer Raha Wala hopes to save thousands of dollars as a result of the program. The 2010 law grad works for an international human rights organization and has $200,000 in student loan debt. “It’s enabling me to do the work that I love,” Wala told the Times.