In 2007, the government rolled out the Public Service Loan Forgiveness program. And now, in 2018, we have finally reached a point where the first cohort of formers students have received their loan forgiveness. And this week, the Education Department released a report that shows just how many borrowers have been able to take advantage of the program.
And the results are uglier than even the most pessimistic soul could have predicted.
Out of over 30,000 applications, taken from student borrowers across the country, the government has accepted exactly…
…96 of them.
No, that’s not a typo. NINETY-SIX! Even as I’m writing this article, I still can’t quite wrap my mind around that number!
As I was researching this story, I came across some writers trying to say that these results are much worse than they will be in the future, as there wasn’t very much clarity back in 2007 regarding the ins and outs of how the program worked. But still, when a program is complicated enough that over 99% of the first group of applicants get rejected for some reason or another, perhaps there’s something wrong with the program’s design.
As we have covered in our guide to getting out of student loan debt, public service loan forgiveness involves not only having the right type of job, but also the right kind of loan. This article, from CNBC, shared the sad story of one 18-year teacher who applied for public service loan forgiveness after her 120 on-time payments, only to be told that the kind of loan she was in didn’t qualify.
These types of stories illustrate why we encourage you here to just try to get out of student loan debt as quickly as possible. Choosing to depend on a federal loan forgiveness program can be a lesson in frustration and disappointment.
But if you do plan on trying to become one of the lucky 1% in the future, then we urge you to read our guide so that you can avoid many of the simple mistakes that tripped up this year’s 99%.