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The U.S. Department of Education is reevaluating account histories for borrowers pursuing Public Service Loan Forgiveness, in some cases reducing the number of qualifying payments and delaying debt cancellation for affected individuals.
PSLF, established in 2007, eliminates federal student debt for government and non-profit employees after 10 years or 120 qualifying monthly payments. Approximately 1.2 million public servants have had their debt forgiven under the program, with an average cleared balance nearing $75,000, according to the Brookings Institution.
Social media platforms document borrower experiences, including one case where an individual’s payment count dropped from nearly 120 to 94 via a Reddit comment.
“We’ve had a few clients who saw their PSLF count drop,” said Nancy Nierman, assistant director of the Education Debt Consumer Assistance Program in New York, a nonprofit providing borrower guidance.
“It’s concerning when someone who relies on numbers reported by the government discovers, through no fault of their own, those numbers were incorrect,” Nierman added.
An Education Department spokesperson attributed the adjustments to “coding errors” from the Biden administration, stating, “These errors resulted in inaccurate payment counts for some borrowers. The Department remains committed to ensuring every qualifying payment is properly credited to a borrower’s account.”
Payment timeline changes may delay major life milestones like homeownership, marriage, or starting a family, according to consumer advocates. Additionally, reduced payment counts could force borrowers to remain in lower-paying roles to maintain PSLF eligibility.
Uncertainty Behind the Payment Count Adjustments
Under the Biden administration, borrowers could request PSLF payment count reconsideration and receive credit for previously non-qualifying periods, including certain payment pauses.
The adjustments followed a 2022 U.S. Government Accountability Office report highlighting inadequate payment accounting. Earlier, the Consumer Financial Protection Bureau warned in 2015 about borrowers being steered into costly forbearances, which paused interest accrual and credit toward forgiveness.
The Department did not specify which Biden-era changes caused the errors. Borrowers affected by payment count changes are not receiving explanations from the government, noted higher education expert Mark Kantrowitz, who emphasized, “When a borrower isn’t given a specific explanation, they are unable to verify whether the change was accurate.”
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Some borrowers are going to see their PSLF counts go up.
The corrections reflect “purely technical accounting errors,” not policy changes, explained Scott Buchanan, executive director of the Student Loan Servicing Alliance. He noted others may benefit from adjustments.
What PSLF Borrowers Can Do
Borrowers who believe payment count reductions are errors should submit a PSLF Reconsideration request to the Education Department, Nierman advised.
To prevent tracking errors, borrowers should screenshot payment counts on Federal Student Aid accounts and maintain personal records via downloaded bank statements,
Employers should complete the employer certification form annually to ensure eligibility, with borrowers retaining records of these forms.
Have you recently seen your PSLF payment count change? If you’re willing to share your story, please email annie.nova@cnbc.com.
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