Borrowers With Old FFELP Loans Who Do Not Qualify for Loan Forgiveness – READ THIS

Let me start with the bad news, and get to the good news after that.

The bad news: FFELP loans are excluded from the President’s proposed forgiveness program – Why?

Because those loans are not held by the federal government – the Dept of Education. At this time, loans held by commercial servicers, like Navient – where my loans are held – do not qualify.

More bad news: Commercially held FFELP borrowers CANNOT take advantage of the payment pause without penalty.

The CARES act payment pause without interest accrual does not apply to privately held loans. Not sure which yours is? Log into and check. If the Dept of Education holds your loan, it is federal, if it does not, you have a commercially held loan. (This took me by surprise. How did I not know this!?)

If you have commercially held loans and do not make payments, your servicer will continue to charge interest on the loan, and also likely late fees and report non-payment to credit bureaus. If you choose to take a forbearance, your interest will likely be tacked on to your capital, and you will see your loan balance rise steadily throughout your forbearance period. Take it from me, and make the minimum payment if you can!

Finally – some good news: There is hope for forgiveness on your loans, but you must ACT NOW. In April 2022, which I am willing to bet your commercial servicer did not tell you, the U.S. Department of Education (ED) announced changes that will bring borrowers closer to forgiveness under income-driven repayment (IDR) plans.

But you need to act before Jan 1, 2023.

I am going through this process myself, I have been paying on my student loans for well over 20 years. As I understand this program, you can get an undergraduate debt forgiven after 20 years of qualifying “payments” and graduate study debt after 25 years. Times in forbearance, deferment, and other periods may be counted towards what they call “IDR-qualifying payments”.

I am not an expert, but this is so confusing and I have read a lot about so I am sharing this information but please read about it on your own as well! It is all free, so if a company tries to charge you for any of this, they are scammers.

What did I do? This:

  1. I applied for an Income Driven Repayment (IDR) plan federal consolidation through the website. I got the information from the Consumer Finance Protection Bureau. I did not get any communication on this at all from my commercial loan servicer because… of course I didnt.
  2. I chose AidVantage as my new federal loan servicer because they had good Google reviews.
  3. I am anxiously awaiting a response. I applied 3 and a half weeks ago. The CFPB website said it can take about a month for my loan application for federal consolidation to process, and I expect they are getting a flood of applications right now, so I expect a bit longer.
  4. My hope is that once the Dept of Education owns my loan, and my payment history is recounted, that I will immediately or soon qualify for loan forgiveness for my nearly $20K remaining balance on my FFELP loans.
  5. Yes I most certainly pay my debts. Before you send me hatemail implying I am looking for a handout and trying to help others get one, too, here are the facts; at 6.5% interest with 22 1/2 years of payments, I have paid the amount I borrowed back several times over. I pay interest on the capitalized interest for the handful of times I had to take a 3 or 6 month forbearance during a layoff, after the birth of my baby, or when taking care of a dying family member. These loans given to teenagers in the 80s and 90s have terms crappier than rent-to-own furniture or used car loans. This loan program was abolished in 2010 because it was predatory, and replaced with federal loan programs that are only a little fairer. Like so many others, I paid my debt back despite ridiculous loan terms and I still owe thousands of dollars.

Read the info carefully: These details are pulled straight from the website:

On April 19, 2022, the U.S. Department of Education (ED) announced several changes and updates that will bring borrowers closer to forgiveness under income-driven repayment (IDR) plans. These adjustments to borrower accounts include conducting a one-time revision of IDR payment counters to address past inaccuracies (including automatically discharging loans for eligible borrowers) and permanently fixing IDR payment counting by reforming ED’s IDR tracking procedures going forward.

ED will begin work on implementing these changes immediately, but borrowers will not see the effect in their accounts until fall of 2022.

One-Time Payment Count Revision for Eligible IDR Borrowers

  • As part of this initiative, ED will conduct a one-time revision of IDR-qualifying payments for all William D. Ford Federal Direct Loan (Direct Loan) Program and federally managed Federal Family Education Loan (FFEL) Program loans.
  • ED will conduct a one-time account adjustment to borrower accounts that will count time toward IDR forgiveness, including
    • any months in which you had time in a repayment status, regardless of the payments made, loan type, or repayment plan;
    • 12 or more months of consecutive forbearance or 36 or more months of cumulative forbearance toward IDR and PSLF forgiveness;
    • months spent in deferment (with the exception of in-school deferment) prior to 2013; and
    • any time in repayment prior to consolidation on consolidated loans.
  • Any borrower with loans that have accumulated time in repayment of at least 20 or 25 years will see automatic forgiveness, even if you are not currently on an IDR plan.
  • If you have commercially held FFEL loans, you can only benefit from the IDR account adjustment if you consolidate before we complete implementation of these changes, which is estimated to be no sooner than Jan. 1, 2023.
  • If you have made qualifying payments that exceed forgiveness thresholds (20 or 25 years), you will receive a refund for your overpayment.

Permanent Fixes to IDR Payment Counting

  • In addition to issuing new guidance to student loan servicers to ensure accurate and uniform payment counting practices, ED will track payment counts in our own modernized data systems.
  • ED is undertaking an effort to display borrower IDR payment counts on so that you can view your progress yourself.
  • Additionally, ED is working on regulations to revise the terms of the IDR program to further simplify payment counting, which includes proposals to allow more loan statuses to count toward IDR forgiveness, including certain types of deferments and forbearances.

Effects on Public Service Loan Forgiveness (PSLF) Applicants

  • If you have applied or will apply for PSLF, these changes may have an impact on you by increasing your qualifying payment count.
  • If you have 12 or more months of consecutive forbearance or 36 or more months of cumulative forbearance, you will receive PSLF credit for those periods of time if you certify qualifying employment.
  • These changes will be applied automatically. If you believe you might benefit, you should update your employment certification history to reflect all periods of public service employment.

Estimate of Impact

  • ED estimates that this action will result in automatic debt cancellation for at least 40,000 borrowers under PSLF and several thousand borrowers under IDR.
  • More than 3.6 million borrowers will receive at least three years of additional credit toward forgiveness under IDR.
  • Beyond the changes that will provide relief retroactively to borrowers, ED will take action to ensure that borrowers continue to receive these benefits in the future.
  • Also note that any debt discharged through IDR will not create a federal tax liability for you. The American Rescue Plan Act included a provision temporarily modifying the tax treatment of discharged student loan debt. Specifically, the law excludes from gross income qualifying student loans that are discharged between December 31, 2020, and January 1, 2026. During this period, the amounts of forgiven student loan debt will not be subject to taxation.

If you’ve made a complaint to your servicer and it has not been resolved to your satisfaction, you can submit a complaint.

I know that is a lot of complicated info and I hope it is helpful. When in doubt, please refer to as your trusted source of information.

A) For federally held student loan forgiveness information – Start here:

B) For info for relief for commercially held FFELP loans, Start here:

C) And the IDR Federal Consolidation application if you have commercially held loans is here:

Published by carissajohnson

Supermom, Wingwoman, Entrepreneur, Collector of Useless Facts and Minutae, Champion Rock Skipper, Butcher, Baker and Candlestick Maker.

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