Smart Borrower Blog

99% of Student Loan Forgiveness Applicants Denied

May 1st, 2019 @ 9:20 PM by Amber Nelson

Less than 1% of borrowers nationwide have been able to take advantage of federal public service loan forgiveness, according to new data from the U.S. Department of Education.

As of the end of 2018, there have been 65,500 loan forgiveness applications filed by those with outstanding student debt. The Education Department has processed 58,000, so far with another 7,200 in the queue. Of those that have been processed, 99% have been denied. More than 73% of applications were rejected because the borrowers had not met the program requirements, while the other 25% were refused because the forms were missing information on the employment certification form.

The Public Service Loan Forgiveness Program was created in 2007 as incentive for college grads to work for government or not-for-profit organizations. The requirements for student loan forgiveness include that applications must work full time for that agency or organization, their loans must be federal Direct Loans, borrower must be set up on an income-driven repayment plan, and they must make 120 qualifying payments (10 years’ worth).

Not understanding all the requirements and rules of the program have tripped up a majority of the applicants. Some did not correctly fill out the Employment Certification Form that show where and how long a borrower has worked. The Education Department recommends submitting this form annually during the first 10 years of student loans to ensure that borrowers are meeting the employment requirements.

Other borrowers did not enroll in the income-driven repayment plans or make enough of the 120 minimum payments. Still others had multiple types of federal student loans and had not consolidated them into Direct Loans before applying for forgiveness.

and had not consolidated them into Direct Loans before applying for forgiveness.

Since the program began in 2007 and required 10 years of payments, the application process only started two years ago. Between the 610 applications and 338 borrowers that have been approved, they have collectively received $21.1 million in loan forgiveness.

About Amber Nelson
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to and

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