RESOLVING THE LEDGER
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0 Share Newsweek is a Trust Project member See more of our trusted coverage when you search. Prefer Newsweek on Google to see more of our trusted coverage when you search. Some student loan borrowers working toward federal debt relief are seeing their path to forgiveness get longer after the Trump administration confirmed it is reversing certain Public Service Loan Forgiveness (PSLF) credits that had previously been applied to their accounts.
The Department of Education said the changes affect borrowers pursuing PSLF, a program that forgives remaining federal student debt for qualifying government and nonprofit workers after they make 120 qualifying monthly payments, or roughly 10 years' worth of payments.
Officials said the rollback is due to coding and payment-count errors dating back to changes implemented during the Biden administration in 2024.
A department spokesperson previously said that the Federal Student Aid office "identified multiple PSLF counter code errors stemming from changes implemented in May 2024 under the Biden Administration. These errors resulted in inaccurate payment counts for some borrowers."
"Like other missteps caused by the previous Administration, FSA has resolved the issue and already notified the vast majority of affected borrowers of updates to their payment counts," a spokesperson for the Department of Education told Newsweek . "The Department remains committed to ensuring that every qualifying payment is properly credited to a borrower’s account."
For borrowers nearing the finish line for PSLF, losing previously credited payments could delay loan forgiveness by months or even years.
There’s also been broader turmoil in the federal student loan system since the Trump administration's repayment overhaul, which took effect July 1.
Borrowers have reported billing errors, inaccurate delinquency notices and ongoing confusion regarding forgiveness programs and repayment requirements.
The Education Department confirmed that Federal Student Aid identified "multiple PSLF counter code errors" tied to changes made in May 2024.
According to the department, those errors resulted in some borrowers receiving incorrect credit toward the 120-payment requirement for PSLF.
As a result, officials have adjusted qualifying payment counts downward for affected borrowers. The department said the issue has been corrected and that "the vast majority" of impacted borrowers have already been notified.
“For public-service borrowers, this is not a new restriction on PSLF itself, but a correction of payment-counting errors dating to changes Federal Student Aid made in 2024, and unfortunately that means some teachers, nurses, government employees, and nonprofit workers who thought they were closer to forgiveness are now being told they have additional qualifying payments to make,” Alex Beene, a financial literacy instructor for the University of Tennessee at Martin, told Newsweek .
So far, the administration has not disclosed how many borrowers are affected.
“The Department of Education says inaccurate credits were added because of coding errors and that the problem has been corrected, but for borrowers who already made decisions based on those official counts, simply removing months years later raises a question about how much responsibility borrowers should have to take on for mistakes made,” Beene said.
Created by Congress in 2007, the Public Service Loan Forgiveness program allows eligible borrowers employed by government agencies and qualifying nonprofit organizations to have their remaining federal student loan balances forgiven after making 120 qualifying payments while working full-time in public service.
More than 9 million borrowers may be eligible for the program.
Now that some credits have been rolled back for these borrowers, Kevin Thompson, the CEO of 9i Capital Group and the host of the 9innings podcast, called it “yet another blow for a beleaguered group of borrowers who have dealt with years of complications within the federal student loan system.”
“I truly believe you will see fewer and fewer people willing to take on government loans, with a higher percentage potentially moving into the private lending space,” Thompson told Newsweek . “In my view, that is ultimately part of what the current administration is trying to achieve: a smaller federal footprint in student lending and a larger role for the private market.”
The Education Department has said the coding errors have been resolved and affected borrowers have largely been notified, but the full number of borrowers impacted has not been released.
Borrowers pursuing PSLF may want to review their qualifying payment counts through StudentAid.gov and retain records of previous payment certifications.
“If public servants can't rely on the payment count displayed, pressure may rise to create stronger safeguards so administrative errors do not repeatedly move back the forgiveness timeline,” Beene said.
Contact Newsweek editors on this story: Jason Lemon and Gray R. Thomas
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