Today, the Consumer Financial Protection Bureau (CFPB) announced plans to help student loan borrowers working in public service – such as teachers, nurses, firefighters, first responders, social workers, and military personnel.
Noting that 1 in 4 American workers holds a public service job, the CFPB pledged to step up efforts to ensure that those workers know they may be eligible for loan forgiveness under federal law.
In 2007, Congress created the Public Service Loan Forgiveness program for public servants who pay their federal loans on time for ten years. People working at a nonprofit or those working for a federal, state, or local government are eligible for the program.
Many public service fields face major workforce shortages in the coming years. Public service employees often have modest income compared with comparable jobs in the private sector, but they perform important functions in society. Saddled with high student debt, some graduates may be reluctant to take public service jobs due to worries about how they’ll be able to repay their debt.
The CFPB’s initiative includes a new toolkit that includes tips for employees on how to qualify for benefits, what their options are, and important things they should consider. The toolkit also provides information for employers on how they can help their employees navigate loan repayment and qualify for forgiveness.
Consumers Union applauds the CFPB’s efforts to help these employees. Still, more needs to be done to ensure that all student loan borrowers have better options for managing their loans. To see our Seven Principles for Fair Student Lending, click here.
Are you a public service employee with student debt? How has your student debt affected your finances or life decisions? Tell us in the comments.