Kaine Pushes Education Department To Fix PSLF ‘Pay Ahead’ Glitch For Borrowers During The Coronavirus Pandemic

WASHINGTON, D.C.  – Today, U.S. Senator Tim Kaine, a member of the Senate Health, Education, Labor, and Pensions (HELP) Committee, released the following statement calling on the Department of Education to immediately fix a glitch in the Public Service Loan Relief (PSLF) program that penalizes borrowers who pay more than their minimum required monthly loan payments. This so-called “pay ahead” status leads borrowers to unknowingly make payments that do not qualify toward loan forgiveness under the PSLF program. In response to an inquiry from Kaine, the Education Department has indicated it will fix this issue, but not until “late in 2020.”

“The Education Department should revise its policy immediately so that public servants with student loans are not penalized during this difficult time. Any advance or lump sum payments that a borrower or an employer makes should qualify toward PSLF,” said Kaine. “First responders, health care workers, and others in public service careers are working tirelessly to protect their communities during this pandemic. The last thing they need to worry about is whether their student loan payments are being counted appropriately.”

Under the CARES Act, Congress suspended federal student loan payments until September 30, 2020 while ensuring that borrowers would still receive credit towards PSLF. However, many borrowers are likely to continue making payments toward their loans or receive loan payments from their employers during this period, especially while interest rates have been reduced to zero percent. Until the “pay ahead” glitch is fixed, these Americans may be at risk of unintentionally making payments that do not count toward the 120 payments required to receive loan forgiveness under PSLF.

In October 2019, Kaine and a group of 25 colleagues called on the Department of Education to make policy changes after a report from the Government Accountability Office found flaws in the mismanagement of the PSLF and Temporary Expanded Public Service Loan Forgiveness (TEPSLF) programs. In response to Kaine’s letter, the Department wrote: “The Department is revising the policy by which we determine whether a monthly payment qualifies for PSLF purposes…Advance or ‘lump sum’ payments may be qualifying monthly payments (up to a maximum of 12 qualifying payments) for PSLF. We anticipate implementing this change with our PSLF servicer late in 2020.” 

You can read the letter from the Department of Education to Senator Kaine here. You can read Kaine’s letter here.

Kaine has helped secure hundreds of millions of dollars in loan relief for public servants who had been denied due to glitches in the Public Service Loan Relief (PSLF) program. Kaine has introduced legislation to fix the flawed PSLF program and has repeatedly called on the Department of Education to fix missteps with implementation of the TEPSLF program to ensure millions of teachers, social workers, members of the military, first responders, nurses, public defenders, and many other public service professionals receive the loan forgiveness they have earned.  

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