Public Service Loan Forgiveness: How to Prepare for FedLoan Servicing’s Departure
Carolina Rodriguez
FedLoan, also known as Pennsylvania Higher Education Assistance Agency (PHEEA), announced last week that it will stop servicing federal student loans on December 14, 2021. This means that at least 8.5 million student borrowers whose loans are currently managed by FedLoan will be transitioned to a new servicer. This transition is particularly concerning for those pursuing the Public Service Loan Forgiveness program (PSLF) because FedLoan is the only servicer administering that program.
If your loans are with FedLoan and you are pursuing PSLF, here are some practical things you can do now to prepare for the transition:
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Stay tuned and check your correspondence. Your loans with FedLoan will be transferred to another servicer. We do not have more specifics as of mid-July. It is thus imperative that you check your mail and/or electronic correspondence periodically. You want to make sure you know what is happening to your loans during the upcoming transition period.
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Keep a copy of your student loan records. Download your records, including notices from your servicer and Federal Student Aid (studentaid.gov). You can also call FedLoan at 1- 866-313-3797 and ask for documents, like payment history or other PSLF-related notices.
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Recertify your Income Driven Repayment (IDR) plan. If you are enrolled in an IDR plan and are due to recertify, do so on time. You can recertify at studentaid.gov or with FedLoan.
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File the PSLF Certification and Application form to update your qualifying payments. The form is available at studentaid.gov. You want to make sure you have an accurate count of your PSLF-qualifying payments.
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Address any PSLF-related disputes with FedLoan. If there are discrepancies with your qualifying payments or other PSLF related issues, be sure to address those with FedLoan as soon as possible. If needed, you can escalate and file a complaint with the NYS Department of Financial Services (click here) and/or the U.S. DOE Ombudsman (click here).
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If your loans are not with FedLoan and you are pursuing PSLF, get more information about what to do. Usually, when you file the PSLF Certification and Application form, your loans are transferred to FedLoan. In this case, you may want to hold off until there is more information about who will be overseeing the program. When in doubt, call us for more specific assistance.
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You do not have to pay for student loan help! If you have student loan questions, contact EDCAP or your servicer. Services are free.
Remember that each situation is different. Do not hesitate to contact our Education Debt Consumer Assistance Program (EDCAP) for unbiased and free over-the-phone and remote counseling services.
We are here to help and guide you. Our helpline is available at 888-614-5004 (M-F, 9 am – 4 pm), or you can email edcap@cssny.org. Visit our website at edcapny.org for more information about our services.