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- The Education Department updated guidance for applying for Public Service Loan Forgiveness.
- Employers now have the option to digitally certify an employee's eligibility for the program.
- Previously, strict paperwork requirements caused many borrowers' applications to be rejected.
A new change to a student-loan forgiveness program could make it easier for government and nonprofit workers to get relief.
President Joe Biden's Education Department updated guidance for the Public Service Loan Forgiveness (PSLF) program, which is intended to forgive student debt for government and nonprofit workers after ten years of qualifying payments.
Leading up to Biden's presidency, the program was flawed and borrowers in public service were being turned away for minor paperwork errors, along with issues having their employer certify their eligibility for the program.
Updated guidance could make that just a bit easier. According to the Federal Student Aid (FSA) office, a borrower applying for PSLF needs the employer to verify information including the dates of employment for the employee and their name, contact information, title, and signature.
Previously, the Education Department had strict guidelines for those certification requirements, and applicants were rejected if a signature on paper did not meet specific requirements, like incorrect formatting of the date signed. Now, borrowers have the option to use a digital signature during FSA's testing period for this function.
"FSA has begun to implement and test a digital employer signature for PSLF," an Education Department spokesperson told Insider. "The Department will have more information once testing is complete."
According to the website, borrowers can use the PSLF Help Tool for "digital signature and submission capabilities." With that option, employers would receive an email from FSA via DocuSign to confirm borrowers' employment online rather than using the often error-prone paper forms required in the past.
Employers can still elect to use a manual form if they do not want to certify their information digitally.
This change is part of the Education Department's broader reforms to PSLF. In October 2021, it implemented a limited-time waiver to allow previously ineligible payments to count toward a borrower's loan forgiveness progress. While the waiver expired on October 31, the department also announced permanent changes to the program, including a one-time account adjustment to allow borrowers one more shot to get their payments up to date, even if they missed the waive deadline.
So far, 453,000 borrowers have gotten their debt wiped out under the PSLF reforms, and the department said it will continue processing the other applications submitted before the waiver deadline. To be sure, the process could take time given the department has limited resources to implement those reforms, along with resume repayment for federal student-loan borrowers this year and implement broad student-debt relief if the Supreme Court rules in favor of Biden's plan.