SERVICE Act

Key Points

• The bill cuts the number of qualifying payments needed for Public Service Loan Forgiveness from 120 (10 years) to 96 (8 years), letting public workers get their remaining student loan balances canceled two years sooner.
• Independent contractors working in public service jobs would now qualify for PSLF, and the definition of full-time is clarified as averaging at least 30 hours per week. Non-tenure-track college instructors get a special formula based on credit hours taught.
• Many types of deferment and forbearance periods — including cancer treatment, military service, unemployment, and economic hardship — would count as qualifying monthly payments toward the 96-payment threshold.
• A new 'buyback' option lets borrowers who were in public service but didn't make qualifying payments during certain months pay a lump sum to have those months count toward forgiveness. Interest can no longer be capitalized after deferment or forbearance periods end.
• The Department of Education must build an online portal where borrowers can track qualifying payments, check job eligibility, submit forms electronically, and manage appeals. A searchable database of qualifying public service jobs must also be created with the Department of Labor.
• If a borrower's forgiveness application is denied, they get a 90-day forbearance period without interest capitalization and a formal reconsideration process. Once a payment is counted as qualifying, the government cannot retroactively take it away.

Votes

No votes have been recorded for this legislation yet.