(WIVB) – If you are carrying a load of student debt and work in the public sector, federal officials are reworking a loan forgiveness program that could wipe the slate clean.
They’re fixing the Public Service Loan Forgiveness Program, which was designed to encourage college students to consider working in public sector jobs or for non-profits.
On paper, officials gave it an “A” but it was the execution that failed.
Congress wanted to steer professionals with big college debts into public service jobs that were going unfilled, such as teachers and first responders by forgiving their loans.
“If you have worked full-time in the public sector for any amount of years you should be reaching out to your loan servicer and asking them about public service loan forgiveness,” said Noelle Carter with the Consumer Credit Counseling Service.
Carter says it did not quite work out that way. Congress established the public service loan forgiveness program in 2007 for graduates who worked in a public service or for a non-profit agency, and after 10 years of payments, the balance on the loan would go away.
But in the first year of eligibility, 99 percent of the applicants were rejected and 94 percent of military borrowers.
“So there was inherently something going on with the requirements, or the qualifications needed to receive the forgiveness if so many people were denied their application,” Carter said.
Reviews showed many of those loans were denied because of minor errors on the part of the applicants, the loan servicers, and the U.S. Department of Education.
The Secretary of Education is now loosening some of the rules for forgiving the loans, and Carter says Consumer Credit Counseling is uniquely qualified to help.
“We saw the writing on the wall that there would be so many people so confused,” she said.
Carter told News 4 their credit counselors have specific knowledge with these loans.
“So if you did not know what loan types you had, or that you have the wrong type of loan type, or how to get it into the right loan type, that was one huge thing that disqualified your payments being made,” she said.
The education department estimates as many as a half million professionals can benefit from the revamped loan forgiveness program.
You can contact consumer credit counseling for help at 1-800-926-9685 or click here.