(MarketWatch) Almost no one will qualify for a program that forgives the debt of borrowers who have worked in public service for a decade next year, the first year that forgiveness becomes available, the government predicts.
President George W. Bush signed the Public Service Loan Forgiveness program (PSLF) into law in 2007 as a way for student loan borrowers to pursue sometimes low-paying public service jobs, ranging from teaching to medicine, without having to worry as much about their debt.
But when calculating the costs of the program, Department of Education staffers assumed that it’s unlikely borrowers will have made enough payments to qualify for forgiveness the first year it’s available, according to a report released by the Government Accountability Office.
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Borrowers doing this work who make 10 years of payments will have the remainder of their debt forgiven. The first cohort of borrowers is theoretically eligible for forgiveness on Oct. 1, 2017, but advocates have been warning that confusion and administrative hurdles related to the program mean that few will qualify for forgiveness next year