AFT lawsuit settlement will put hundreds of thousands of educators on the path to student loan forgiveness

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Yesterday, the U.S. Department of Education announced major changes to the Public Service Loan Forgiveness (PSLF) program, finally addressing the serious problems AFT members have faced in accessing student loan forgiveness. The changes, in part, were spurred by a lawsuit AFT filed against the department and then-Secretary Betsy DeVos, who stood by doing nothing as thousands of educators brought complaints of unfair practices and broken promises.

This lawsuit settlement is a game-changing victory for educators, healthcare professionals, and public employees and will allow millions of Americans to discharge their student debt sooner, offering them increased economic mobility and access to opportunities to thrive.

Texas AFT has also taken the lead in our state by sponsoring statewide Student Debt Clinics training hundreds of members to get their loans forgiven and reduce payments.

Does this settlement apply to you?

If you have worked in public service for 10 years or more and made 10 years of payments on your student loans, you are likely eligible to have your debt discharged under PSLF. Even if you were denied PSLF in the past OR your loan servicer said you do not qualify, under this settlement, your application will be reconsidered. In the past, only on-time payments made on direct loans using income-driven repayment plans or standard 10-year repayment plans counted toward PSLF.

Here’s what is new:

The department will retroactively count your past payments toward your 120-payment requirement for PSLF, even if they were made on the wrong loan type or on the wrong payment plan. This means your loan payments WILL count, even if you made those past payments on:

Current or prior Federal Family Education Loans; or Graduated or other types of payment plans that did not previously count. Other types of payments, such as past rolling late payments, will also count.

This is a huge win for AFT members struggling with student debt. If implemented correctly, this settlement will help ensure that millions of people, including tens of thousands of educators, nurses, and public employees, will have their loans completely forgiven or be given credit for years of past payments, putting them much closer to full forgiveness.

The Bid en administration continues to work on implementation of these changes, with input from the AFT, to ensure a fast, clear, and simple process so public service workers can get full credit for the payments they have made toward PSLF and soon see a zero balance on their student loan statement.

Graphic of two hands holding a map with dotted lines navigating through buildings. Text: Student loans are a maze. We're partnering to guide the way.

What you need to do now to get help from the AFT: