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According to librarian Katie Punch’s calculations, she will qualify for public service loan forgiveness in November 2024. At that point, she applied to the U.S. Department of Education for a program that would allow her to make her final qualifying payment and wipe out her nearly $30,000 balance.
More than 14 months later, she’s still waiting for answers.
“I’m trying to save more in case I don’t get the forgiveness I’ve earned so far and was supposed to receive in November 2024,” said Punch, 38, who lives in North Carolina.
Under the Trump administration, more than 83,000 federal student loan borrowers, including Mr. Punch, were waiting to apply for PSLF buybacks, court records show.
PSLF was signed into law by President George W. Bush in 2007 and provides student loan forgiveness to people who worked for 10 years in certain nonprofit organizations or the government. The buyback option allows borrowers seeking PSLF to make retroactive payments for months missed due to forbearance or deferral, accelerating the timeline for debt cancellation.
The backlog of pending PSLF repurchase requests has steadily increased in recent months, with 80,210 people remaining in the queue in November, for example, and 74,510 in August.
Some advocates working with borrowers report that their requests have been approved, while others have not.
“At this time, no one on our team has seen a successful completion of a repurchase application,” said Carolina Rodriguez, director of the New York Education Debt Consumer Assistance Program.
Experts say some borrowers have lost their appetite for waiting. CNBC spoke to several people still in line who said they no longer believed the government would approve their applications.
The U.S. Department of Education did not respond to requests for comment.
Reasons why PSLF repurchase balance has increased
The Biden administration introduced a PSLF buyback program in 2023. But the opportunity gained particular attention after the court blocked the Biden-era Savings for a Valuable Education (SAVE) plan in 2024.
Millions of student loan borrowers who enrolled in SAVE were automatically enrolled in forbearance during that legal battle. These borrowers found their progress toward PSLF frozen during the payment pause, even though they continued to work in eligible public service.
More than 7 million student loan borrowers remain in SAVE suspension, according to higher education expert Mark Kantrowitz. He said many borrowers are trying to opt out of their plans, but there is a massive backlog of more than 734,000 applications for new repayment plans.
Multitasking after application
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Betsy Mayotte, president of the Association of Student Loan Advisors, a nonprofit organization that helps borrowers repay their loans, said despite the long wait, it’s worth applying for a PSLF buyback if you think you qualify.
“I’ve seen borrowers pick it up recently,” Mayotte said.
At the same time, she says, she doesn’t want to rely on debt forgiveness options. You should also try to keep up with your loan payments.
If you’re still on a SAVE plan, one option is to apply for a standard repayment plan to make your remaining PSLF payments. The current backlog is for borrowers who switch to income-driven repayment plans, and the Department of Education should be able to move them to standard repayment plans soon, she said.
Meanwhile, student loan borrowers who have filed a buyback request and are not employed by a qualifying employer “will have to hang tight,” Rodriguez said.
“Switching plans won’t give you the credit you need,” she says.
How the PSLF Buyback offer works
After a borrower submits a PSLF repurchase request, the Department of Education is supposed to send the borrower an offer letter. The letter details the number of monthly payments they missed during their career in public service and gives them the opportunity to pay that bill now in exchange for student loan forgiveness.
Borrowers who continue to make payments in the meantime may be eligible for a refund.
Punch said she calculated she would need to buy back five months to qualify for PSLF and estimated she owed about $1,500.
“I’d really like a buyback process so I can pay,” she said.
