Public Service Loan Forgiveness applicants are facing processing delays that have left some borrowers who made their 120th payment waiting for credit. The Department of Education says it is committed to correcting records but has not given a timetable. Recent repayment rules tightened qualifying requirements and removed a 15-day grace window, and a July 1 rule narrowing employer eligibility was blocked by courts; the department has appealed and the case is pending.
Student-Loan Forgiveness in Limbo: PSLF Counters Still Lag After 120th Payment
Student-loan borrowers are facing delays getting relief through the Public Service Loan Forgiveness program.nirat/Getty Images
Borrowers pursuing Public Service Loan Forgiveness (PSLF) say processing delays and policy changes have left some who reached the 120-payment threshold waiting for their accounts to reflect eligibility for debt cancellation.
What’s happening: Several borrowers report that their Federal Student Aid payment counters did not update after what would have been their 120th qualifying payment, effectively leaving them uncertain whether they have earned forgiveness. That delay forces a difficult choice: continue making payments they may no longer owe or stop and risk being reported delinquent until records are corrected.
Department response: The U.S. Department of Education has acknowledged the issue without providing a timeline for fixes. A department spokesperson said the agency "remains committed to ensuring that every qualifying payment is properly credited to a borrower's account," but offered no firm date for resolving discrepancies.
Policy Changes, Coding Errors, And Court Battles
The administrative overhaul of federal student-loan repayment under President Donald Trump tightened the criteria for what counts as a qualifying PSLF payment and removed the 15-day grace window that previously allowed a late payment to still count toward PSLF. Under current Federal Student Aid guidance, a payment must be made "on or before the due date" to be credited, and payments do not need to be consecutive to qualify. That standard applies to both the new Repayment Assistance Plan created under the overhaul and to existing repayment plans.
Complicating matters, some borrowers say previously credited PSLF payments were rescinded — an action the administration has attributed to coding errors. Those reversals, together with inaccurate account statuses, have left borrowers unsure of their balances and timelines to forgiveness.
Eligibility is also the subject of ongoing litigation. A rule scheduled for July 1 would have narrowed which employers qualify as "public service," excluding certain organizations. Courts blocked that rule after lawsuits from nonprofit groups, and the Department of Education appealed the injunction at the end of August. The case is pending in the D.C. Circuit, and there are no immediate program changes while the court considers the appeal.
What Borrowers Can Do
- Keep records: Save payment confirmations, bank statements, and any correspondence from your loan servicer or Federal Student Aid.
- Check accounts frequently: Monitor your Federal Student Aid profile and your loan servicer’s portal for updates.
- Communicate with your servicer: If you believe a qualifying payment was not credited, contact your loan servicer and submit documentation.
- Consider continuing payments temporarily: To avoid the risk of delinquency while records are corrected, many borrowers may opt to continue paying until their status is confirmed.
Until processing issues and legal challenges are resolved, borrowers face uncertainty about whether their payments will count, how much is still owed, and when — or if — forgiveness will be granted.
Reporter contact: Ayelet Sheffey at [email protected].
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