PSLF is Transitioning from MOHELA to StudentAid.gov: What To Expect

The federal government is officially taking over the Public Service Loan Forgiveness (PSLF) program. Borrowers can expect a temporary pause in PSLF processing from May to June 2024 while all information is moved from the MOHELA website to StudentAid.gov. After the PSLF transition is complete, you’ll be able to easily track your PSLF progress in a centralized location.

Keep reading to learn why the PSLF transition is happening and what it means for you.

Why PSLF is moving from MOHELA to the Department of Education

The PSLF program has been riddled with problems from the beginning. For years, nuanced eligibility requirements — such as being on the right IDR plan and having specific types of loans —  resulted in unexpected denials and continued confusion among borrowers. Additionally, FedLoan Servicing did a terrible job managing the PSLF program, further discouraging borrowers to seek PSLF forgiveness.

Although many of these wrongs were righted thanks to the PSLF Waiver and IDR Waiver, borrowers still face frustrations despite PSLF accounts being transferred over to MOHELA in 2022. The Department of Education is stepping in to streamline PSLF processing by taking over the program from MOHELA.

In doing so, the PSLF program is effectively suspended from May to June 2024 to give the federal government time to build out a PSLF portal on the Federal Student Aid (FSA) website.

The PSLF transition from MOHELA to StudentAid.gov will bring everything PSLF into one spot, with the hopes of improving borrower experience overall. But there’s more to the story…

What’s really behind the PSLF transition?

Although the PSLF transition is good news for borrowers, there’s a hidden agenda (isn’t there always?) that student loan borrowers should pay attention to.

Remember the student loan cancellation case that made it all the way to the Supreme Court? A coalition of Republican-led states sued on behalf of MOHELA and ultimately won. The ruling describes MOHELA as an instrument of the state of Missouri, which is controlled by Republican leadership. Therefore, MOHELA is the achilles heel for Democrats hoping to push through student loan cancellation initiatives in the future.

Here’s where we have to look at the bigger picture of student loans. The Biden administration knows MOHELA is a major roadblock. But they can’t remove MOHELA from the equation if it's managing a substantial borrower program like PSLF.

We expect the Biden administration will do everything it can to get rid of MOHELA as a loan servicer if a second term comes to fruition, preventing Republicans from being able to use MOHELA as a tool to block future student loan cancellation efforts.

What the PSLF pause means for your student loan forgiveness timeline 

The U.S. Department of Education is pausing processing for all PSLF forms while it transitions the program from MOHELA to StudentAid.gov. The program suspension is expected to last through the end of June 2024. How does this pause affect you as a PSLF borrower?

The PSLF transition shouldn’t negatively impact most PSLF borrowers. But if you were planning to receive PSLF forgiveness in May or June, you’ll have to wait a little longer until processing resumes.

Here is some additional PSLF transition information to be aware of:

• You won’t be able to access information during the PSLF blackout. You won’t be able to access or update your PSLF progress, certified employment or payment counts via MOHELA’s borrower portal. The Department of Education recommends saving screenshots of payments and correspondence for your personal records. However, we’ve heard from clients that their PSLF tracker has already disappeared from the MOHELA website. So, it’s likely not an option now that the PSLF transition is underway.
• You can still submit PSLF forms. However, they won’t be processed until the PSLF transition is complete, which should be by July.
• There are options if you reach forgiveness during the pause. You can request a forbearance or continue making payments and receive a refund for overpayments once your PSLF form is processed. 
• Payments are still due. Continue making payments to your loan servicer, including MOHELA.

Although the Department of Education is bringing the PSLF program in-house, MOHELA will continue to manage your monthly payments unless your account is transferred to another loan servicer in the future.

What it means to have PSLF managed by the federal government

Like all things student loans, the PSLF transition could end up a little messy in the beginning. But this isn’t a huge change for PSLF borrowers overall. The Department of Education is simply taking over responsibility for tracking and communicating with borrowers about PSLF progress rather than delegating that task to a loan servicer.

PSLF applications and employment certifications forms have always been submitted to the Department of Education. But now there will be a PSLF dashboard housed on StudentAid.gov, making it more convenient for borrowers to stay informed and avoid missteps along the way. 

Hopefully this streamlining effort will also speed up PSLF processing times in the future. But for now, just know that your PSLF progress will be tracked at StudentAid.gov instead of MOHELA.

Borrowers seeking general income-driven repayment (IDR) forgiveness should also be able to track their progress on StudentAid.gov in the coming months.

Need help figuring out the best route for loan forgiveness or repayment? Our team of student debt experts has consulted on over $2.6 billion of student loans, saving borrowers a projected $626 million across professions. Book a consult today.