PSLF going forward

Discuss various money matters here. Loans (federal and private), scholarships, lottery winnings, or other school finance related information and queries.
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nevdash
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Re: PSLF going forward

Postby nevdash » Tue Nov 15, 2016 11:41 pm

NCGuy wrote:When I consolidated my loans, the promissory note said that the remaining balance will be forgiven after 120 on-time payments using a qualified payment plan. I feel like current borrowers are safe but future ones might get screwed.

https://static.studentloans.gov/images/ApplicationAndPromissoryNote.pdf

Relevant quote:
A Public Service Loan Forgiveness program is also available. Under this program, we will forgive the remaining balance due on your eligible Direct Loan Program loans after you have made 120 payments on those loans (after October 1, 2007) under certain repayment plans while you are employed full-time in certain public service jobs.


You could certainly weaken this through the regulatory structure (get rid of the definition of "certain public service jobs" and "certain repayment plans") but it seems like more effort than the Trump Administration would want to go through.


Strange. I just looked at my MPN (signed in 2009), and it says:

"A public service loan forgiveness program is also available. Under this program, the remaining balance due on your eligible Direct Loan Program loans may be cancelled after you have made 120 payments on those loans (after October 2, 2007) under certain repayment plans while you are employed in certain public service jobs."

I hope the "will" vs. "may" thing doesn't screw different borrowers depending on the specific language in their MPN. There's no way that would happen, right?

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A. Nony Mouse
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Re: PSLF going forward

Postby A. Nony Mouse » Wed Nov 16, 2016 12:29 am

Damn, I don't even know where to find my MPN.

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nevdash
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Re: PSLF going forward

Postby nevdash » Wed Nov 16, 2016 10:15 am

I found mine on studentloans.gov.

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A. Nony Mouse
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Re: PSLF going forward

Postby A. Nony Mouse » Wed Nov 16, 2016 10:31 am

Thank you!! I knew there was a site besides MyFedLoan but its changed its name like 3 times since I originally took out the loans. :D

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A. Nony Mouse
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Re: PSLF going forward

Postby A. Nony Mouse » Wed Nov 16, 2016 10:36 am

FWIW, this is the language in mine as well (from 2008-10)
nevdash wrote:"A public service loan forgiveness program is also available. Under this program, the remaining balance due on your eligible Direct Loan Program loans may be cancelled after you have made 120 payments on those loans (after October 2, 2007) under certain repayment plans while you are employed in certain public service jobs."

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NCGuy
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Re: PSLF going forward

Postby NCGuy » Wed Nov 16, 2016 11:55 am

We do have precedent, the government has never (or rarely does) enacted a change to a program and then retroactively harmed people who were eligible for it. There's also the fact that there hasn't been a serious proposal to curtail forgiveness for people who already have loans disbursed. Didn't Obama's proposed cap (that didn't pass) only apply to people who took out their first loan after July 1, 2015?

Also, I imagine that enough Congressional staffers are reliant on PSLF and IBR that it's unlikely that it would change too much.

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beenoparte125
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Re: PSLF going forward

Postby beenoparte125 » Wed Nov 16, 2016 12:51 pm

Curious if someone could summarize what this means for those of us planning on entering school next fall? Lots of details here that are over my head...

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dresden doll
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Re: PSLF going forward

Postby dresden doll » Wed Nov 16, 2016 12:53 pm

NCGuy wrote:We do have precedent, the government has never (or rarely does) enacted a change to a program and then retroactively harmed people who were eligible for it. There's also the fact that there hasn't been a serious proposal to curtail forgiveness for people who already have loans disbursed. Didn't Obama's proposed cap (that didn't pass) only apply to people who took out their first loan after July 1, 2015?

Also, I imagine that enough Congressional staffers are reliant on PSLF and IBR that it's unlikely that it would change too much.


Yeah I actually think it's really pretty unlikely this becomes retroactive. I do however see a cap of some kind or another in our future.

cavalier1138
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Re: PSLF going forward

Postby cavalier1138 » Wed Nov 16, 2016 12:56 pm

beenoparte125 wrote:Curious if someone could summarize what this means for those of us planning on entering school next fall? Lots of details here that are over my head...


In short, it means nothing right now. It's just something to be aware of. Your financial aid office will be on top of any changes to PSLF.

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Babe-Loblaw
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Re: PSLF going forward

Postby Babe-Loblaw » Thu Nov 17, 2016 2:50 pm

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Last edited by Babe-Loblaw on Tue Dec 06, 2016 6:57 pm, edited 1 time in total.

cavalier1138
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Re: PSLF going forward

Postby cavalier1138 » Thu Nov 17, 2016 4:14 pm

Babe-Loblaw wrote:So for those of us 0Ls, does this mean picking prestige over scholarship is no longer an option? Because with my numbers right now I can probably get Georgetown with a minimal amount of need-based funding and GWU with $$$, but goddamn if the Harrison Institute's Affordable Housing Transactions Clinic doesn't do exactly what I want to do.


No. For the last time, nothing is happening to PSLF right now. You should still be looking at the school's LRAP program, and you should still not be giving huge weight to a single clinic in choosing your law school.

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Babe-Loblaw
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Re: PSLF going forward

Postby Babe-Loblaw » Thu Nov 17, 2016 4:34 pm

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Last edited by Babe-Loblaw on Tue Dec 06, 2016 6:57 pm, edited 1 time in total.

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NCGuy
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Re: PSLF going forward

Postby NCGuy » Sat Nov 19, 2016 12:38 am

I found a thread from 2 years ago where people were freaking out about Obama's cap on PSLF. If the Republicans didn't take Obama up on the plan to cap PSLF then, I'd say that we're safe. I really don't think that screwing over student borrowers is on Trump's agenda. The Republican line is that they want to bring the cost of education down, which a cap or elimination of PSLF would likely accomplish.

Either way, we'll likely have yearly freakout threads until SOMETHING is passed.

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Hennessy
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Re: PSLF going forward

Postby Hennessy » Thu Dec 15, 2016 12:54 pm

beenoparte125 wrote:Curious if someone could summarize what this means for those of us planning on entering school next fall? Lots of details here that are over my head...


u probably already know these terms, but:

LRAP - school helps you repay your loans
PSLF - remaining loan debt forgiven after 120 qualifying payments made to your $ balance in an eligible job (govt./non-profit/public service etc.)
IBR - loan repayment based on your income, caps your monthly payments to a percentage of your paycheck
IBR + PSLF - low monthly payments for 10yrs --> rest of debt is forgiven (we don't really know yet because program hasn't run 10yrs since enacted)

Conserv-backed Congress + Trump + some SCOTUS nominations = could possibly axe the PSLF program (which is not really a program.)
If he does, there's no real way for those who currently rely on the PSLF or IBR+PSLF to be grandfathered in, because it's not a program. It's a forgiveness after 10yrs.

For us future graduates, this could mean that post-graduation in 2020 we may not be able to count on PSLF forgiveness in 2030, and should therefore read into the LRAP payment program that our school has to assist with repayment.

Except it's all hypothetical;
  1. we don't know that Trump will axe PSLF
  2. he might even axe IBR
  3. we don't know that the next pres. (2020 or 2024) won't reinstate one or both if he does
  4. we don't know that following president (2028 or 2032) won't etc. etc.

Basically, read up on your school's LRAP program and be prepared to assume crash positions.

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studentloanplanner
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Re: PSLF going forward

Postby studentloanplanner » Mon Dec 26, 2016 2:12 am

NCGuy wrote:I found a thread from 2 years ago where people were freaking out about Obama's cap on PSLF. If the Republicans didn't take Obama up on the plan to cap PSLF then, I'd say that we're safe. I really don't think that screwing over student borrowers is on Trump's agenda. The Republican line is that they want to bring the cost of education down, which a cap or elimination of PSLF would likely accomplish.

Either way, we'll likely have yearly freakout threads until SOMETHING is passed.


I view the Republican Congress as having decided not to work with Pres. Obama because they both had different competing goals on HOW to get rid of PSLF. The republicans wanted it gone for all future borrowers but for it to remain for current ones. Likely because they have way more doctors benefiting from it than lawyers and doctors typically vote republican, just a guess though.

Once Trump goes into office, I feel like there's 90% certainty PSLF will go away for new students in the fall of 2017 as the Republicans are philosophically opposed to the idea of covering people's loan debts. If I was currently going for PSLF (I'm a student loan consultant not a lawyer or law student), then what I'd do is hedge my risk.

I'd probably switch to REPAYE to gain an interest subsidy and minimize the growth of my balance. I'd aggressively put money away in my retirement plan to minimize my monthly payments and I'd also save $500-$1000 a month in index funds at Vanguard so if for some reason they bailed on PSLF, I could jump to the private sector for three years, throw several thousand at my loans, refinance, and try to pay it all off. If I was in school, I'd borrow with the expectation that it could be gone one day and that I might have to pay it back.

Betting the farm on PSLF is ok if you have no other option. If you do have other options I'd never risk it.

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Nebby
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Re: PSLF going forward

Postby Nebby » Mon Dec 26, 2016 10:38 am

studentloanplanner wrote:
NCGuy wrote:I found a thread from 2 years ago where people were freaking out about Obama's cap on PSLF. If the Republicans didn't take Obama up on the plan to cap PSLF then, I'd say that we're safe. I really don't think that screwing over student borrowers is on Trump's agenda. The Republican line is that they want to bring the cost of education down, which a cap or elimination of PSLF would likely accomplish.

Either way, we'll likely have yearly freakout threads until SOMETHING is passed.


I view the Republican Congress as having decided not to work with Pres. Obama because they both had different competing goals on HOW to get rid of PSLF. The republicans wanted it gone for all future borrowers but for it to remain for current ones. Likely because they have way more doctors benefiting from it than lawyers and doctors typically vote republican, just a guess though.

Once Trump goes into office, I feel like there's 90% certainty PSLF will go away for new students in the fall of 2017 as the Republicans are philosophically opposed to the idea of covering people's loan debts. If I was currently going for PSLF (I'm a student loan consultant not a lawyer or law student), then what I'd do is hedge my risk.

I'd probably switch to REPAYE to gain an interest subsidy and minimize the growth of my balance. I'd aggressively put money away in my retirement plan to minimize my monthly payments and I'd also save $500-$1000 a month in index funds at Vanguard so if for some reason they bailed on PSLF, I could jump to the private sector for three years, throw several thousand at my loans, refinance, and try to pay it all off. If I was in school, I'd borrow with the expectation that it could be gone one day and that I might have to pay it back.

Betting the farm on PSLF is ok if you have no other option. If you do have other options I'd never risk it.

PSLF was a Republican program to begin with. Calling them philosophically opposed is a bit much.

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A. Nony Mouse
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Re: PSLF going forward

Postby A. Nony Mouse » Mon Dec 26, 2016 12:33 pm

Trump has actually proposed improving repayment plans (forgiveness after a shorter period), so he's not philosophically opposed. Not that that necessarily governs what Republicans collectively will do, of course.

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studentloanplanner
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Re: PSLF going forward

Postby studentloanplanner » Wed Dec 28, 2016 2:05 pm

The current Republican Congress is philosophically opposed to what PSLF has become. Looking at their efforts to repeal it in 2015 shows that. Perhaps the Republican Congress in 2007 had different views or more accurately had no clue what the heck they were doing.

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Nebby
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Re: PSLF going forward

Postby Nebby » Wed Dec 28, 2016 2:14 pm

studentloanplanner wrote:The current Republican Congress is philosophically opposed to what PSLF has become. Looking at their efforts to repeal it in 2015 shows that. Perhaps the Republican Congress in 2007 had different views or more accurately had no clue what the heck they were doing.

You do not appear to have a solid understanding of how repeal of PSLF would look. It sounds require Democratic votes to bring to the floor in the Senate and that won't happen.

Further, there was a single resolution calling for the elimination of PSLF by the House budget committee in 2015. I would hardly call this act representative of Congressional Republican philosophy

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NCGuy
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Re: PSLF going forward

Postby NCGuy » Wed Dec 28, 2016 4:21 pm

Nebby wrote:
studentloanplanner wrote:The current Republican Congress is philosophically opposed to what PSLF has become. Looking at their efforts to repeal it in 2015 shows that. Perhaps the Republican Congress in 2007 had different views or more accurately had no clue what the heck they were doing.

You do not appear to have a solid understanding of how repeal of PSLF would look. It sounds require Democratic votes to bring to the floor in the Senate and that won't happen.

Further, there was a single resolution calling for the elimination of PSLF by the House budget committee in 2015. I would hardly call this act representative of Congressional Republican philosophy


The current Senate situation presents a few interesting scenarios. I imagine that a lot of the current student loan might end up being frozen in place (which is good and bad, I suppose).

Of course, Senate Republicans could change the filibuster rule with a simple majority but I imagine that they won't because they know that they'll be the minority party again eventually.

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studentloanplanner
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Re: PSLF going forward

Postby studentloanplanner » Thu Dec 29, 2016 3:02 pm

Senate Democrats and President Obama wanted to cap the PSLF benefit at $57,500. I'll cede the point about the budget committee possibly not being reflective of the full body. Even then, the only disagreement between the two parties is how to limit or end PSLF, not how to keep it around. If I were Georgetown or another law school outside of the top 5, that as well as potential caps of Grad Plus loans would make me extremely nervous

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NCGuy
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Re: PSLF going forward

Postby NCGuy » Thu Dec 29, 2016 5:33 pm

studentloanplanner wrote:Senate Democrats and President Obama wanted to cap the PSLF benefit at $57,500. I'll cede the point about the budget committee possibly not being reflective of the full body. Even then, the only disagreement between the two parties is how to limit or end PSLF, not how to keep it around. If I were Georgetown or another law school outside of the top 5, that as well as potential caps of Grad Plus loans would make me extremely nervous


Wouldn't schools in the top 5 also be nervous here? A cap on the PLUS Loan could be devastating to them. The disagreement on how to limit or end PSLF could prolong the status quo. As it already has.

Institutions of higher ed have a lot to lose in this fight and many of them have lobbyists in Washington. I'd be surprised if this went away without a fight of some kind. This is the first time the PSLF has been in any real danger.

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Tanicius
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Re: PSLF going forward

Postby Tanicius » Thu Dec 29, 2016 6:12 pm

NCGuy wrote:
studentloanplanner wrote:Senate Democrats and President Obama wanted to cap the PSLF benefit at $57,500. I'll cede the point about the budget committee possibly not being reflective of the full body. Even then, the only disagreement between the two parties is how to limit or end PSLF, not how to keep it around. If I were Georgetown or another law school outside of the top 5, that as well as potential caps of Grad Plus loans would make me extremely nervous


Wouldn't schools in the top 5 also be nervous here? A cap on the PLUS Loan could be devastating to them. The disagreement on how to limit or end PSLF could prolong the status quo. As it already has.

Institutions of higher ed have a lot to lose in this fight and many of them have lobbyists in Washington. I'd be surprised if this went away without a fight of some kind. This is the first time the PSLF has been in any real danger.


The top-most schools are increasingly rolling out LRAP plans that make PSLF irrelevant. Coworker of mine from HLS didn't even know what PSLF was when we were ranting about the possibility of negative changes to it. His law school is covering his loans no matter what.

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Re: PSLF going forward

Postby Nebby » Thu Dec 29, 2016 6:15 pm

Tanicius wrote:
NCGuy wrote:
studentloanplanner wrote:Senate Democrats and President Obama wanted to cap the PSLF benefit at $57,500. I'll cede the point about the budget committee possibly not being reflective of the full body. Even then, the only disagreement between the two parties is how to limit or end PSLF, not how to keep it around. If I were Georgetown or another law school outside of the top 5, that as well as potential caps of Grad Plus loans would make me extremely nervous


Wouldn't schools in the top 5 also be nervous here? A cap on the PLUS Loan could be devastating to them. The disagreement on how to limit or end PSLF could prolong the status quo. As it already has.

Institutions of higher ed have a lot to lose in this fight and many of them have lobbyists in Washington. I'd be surprised if this went away without a fight of some kind. This is the first time the PSLF has been in any real danger.


The top-most schools are increasingly rolling out LRAP plans that make PSLF irrelevant. Coworker of mine from HLS didn't even know what PSLF was when we were ranting about the possibility of negative changes to it. His law school is covering his loans no matter what.

Eh that's only if you have no debt outside of law school (except for hys that also cover part or all of ug debt)

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NCGuy
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Re: PSLF going forward

Postby NCGuy » Thu Dec 29, 2016 10:46 pm

Nebby wrote:
Tanicius wrote:
NCGuy wrote:
studentloanplanner wrote:Senate Democrats and President Obama wanted to cap the PSLF benefit at $57,500. I'll cede the point about the budget committee possibly not being reflective of the full body. Even then, the only disagreement between the two parties is how to limit or end PSLF, not how to keep it around. If I were Georgetown or another law school outside of the top 5, that as well as potential caps of Grad Plus loans would make me extremely nervous


Wouldn't schools in the top 5 also be nervous here? A cap on the PLUS Loan could be devastating to them. The disagreement on how to limit or end PSLF could prolong the status quo. As it already has.

Institutions of higher ed have a lot to lose in this fight and many of them have lobbyists in Washington. I'd be surprised if this went away without a fight of some kind. This is the first time the PSLF has been in any real danger.


The top-most schools are increasingly rolling out LRAP plans that make PSLF irrelevant. Coworker of mine from HLS didn't even know what PSLF was when we were ranting about the possibility of negative changes to it. His law school is covering his loans no matter what.

Eh that's only if you have no debt outside of law school (except for hys that also cover part or all of ug debt)


This.

The majority of people who enter LS already have undergrad debt. If the possibility of getting undergrad debt forgiven its taken away then I imagine that some might consider other plans.




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