An Education Department program intended to forgive student loan debt for public service workers is still rejecting 98% of applicants despite President Joe Biden’s promise to fix it, Insider reports.
The Public Service Loan Forgiveness program was created to allow government and nonprofit workers with federally-backed student loans to apply for forgiveness if they have made 120 monthly payments.
The program came under fire under former President Donald Trump and Education Secretary Betsy DeVos, when the program rejected 99% of applicants.
The Education Department approved just 661 of 54,000 applications between 2018 and 2019, spending just $27 million of the $700 million Congress carved out for the program.
The rate of rejections did not improve in subsequent years under Trump.
New Education Department data shows that 97.9% of applicants through April were rejected despite Biden’s vow to “see to it that the existing Public Service Loan Forgiveness Program is fixed, simplified, and actually helps teachers."
"Washington has had almost 14 years to get PSLF right," said Seth Frotman, executive director of the Student Borrower Protection Center. "Enough excuses. Enough deflecting. Enough of industry cashing in while borrowers struggle and @usedgov sits at the sidelines. It's time to restore the promise of PSLF.”
Dems push to fix program:
More than 50 Democrats last month signed a letter to Education Secretary Miguel Cardona calling on the department to fix the program.
"After the first round of forgiveness initially became available to PSLF borrowers more than three years ago, approval rates for the program have remained below 2.5%," the letter said. "The program has been beset by numerous 'donut holes' that disqualify certain types of loans, repayment plans and the payments themselves, leading to extraordinary confusion and distrust of the PSLF program and, by extension, the federal government."
The Biden administration said that it will review the PSLF and "plans to look at these regulations for improvements."