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Federal Student Loan servicers requested to alert borrowers of forgiveness program

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CHICAGO (WREX) — The Illinois Department of Financial and Professional Regulation (IDFPR) said today that the department has sent a letter to all federal student loan servicers.

The letter encourages them to quickly set best practices to help educate eligible student loan holders about the Public Service Loan Forgiveness (PSLF) program.

As a primary contact for many student loan borrowers, servicers are in the best position to help borrowers take advantage of the program.

PSLF forgives the remaining student loan balance of full-time government and certain non-profit employees after making 120 qualifying payments.

To allow more borrowers to qualify for forgiveness, the government announced temporary program changes, including waiving some past requirements.

However, numerous borrowers are unaware of these changes and may miss out on participating on the loan forgiveness as a result. 

The temporary changes expire on October 31.

“Alleviating student loan debt and protecting borrowers are top priorities of the Pritzker Administration and IDFPR,” said Mario Treto, Jr, Secretary of the Illinois Department of financial and Professional Regulation.

“In the case of PSLF, too many borrowers have been denied or not told about the benefits of the program. We want to work with the loan servicers to fix this problem.”

There are 359,728 public service workers in Illinois with student loan debt, but only 4,800 were able to get their debt cancelled through PSLF.

The letter sent to loan servicers explains best practices, proactive communication to borrowers, updated training practices for customer service representatives, and placing notices on their website.

For more information regarding PSLF and the temporary changes, visit the Student Aid website.

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