Student loan borrowers wait over a year in PSLF Buyback backlog

By librarian Katy Punch’s reckoning, she became eligible for Public Service Loan Forgiveness in November 2024. At that point, she submitted an application to the U.S. Department of Education for a program that would allow her to make her last qualifying payments and wipe out her roughly $30,000 balance.

More than 14 months later, she is still waiting for an answer.

“I am trying to save more just in case I don’t receive the forgiveness I have earned and should have received in November 2024,” said Punch, 38, who lives in North Carolina.

Under the Trump administration, more than 83,000 federal student loan borrowers — including Punch — are waiting in a backlog of PSLF Buyback applications, court records show.

PSLF, signed into law in 2007 by President George W. Bush, offers student loan forgiveness to those who’ve spent a decade working for certain not-for-profits or the government. The buyback option allows borrowers pursuing PSLF to retroactively pay for any months they missed because of a forbearance or deferment, accelerating their timeline to debt cancellation.

The backlog of pending PSLF Buyback requests has been steadily rising in recent months: In November, 80,210 people were in the queue, for example, and 74,510 were in August.

Some advocates working with borrowers report seeing requests approved, while others have not.

“At this time, no one on our team has seen a successful buyback request completed,” said Carolina Rodriguez, director of the Education Debt Consumer Assistance Program in New York.

Some borrowers have become discouraged by the wait, experts say. CNBC spoke with several people still in the queue who said they no longer believe the administration will approve their application.

The U.S. Department of Education did not immediately respond to a request for comment.

The Biden administration rolled out PSLF Buyback in 2023. But the opportunity became especially popular after courts blocked the Biden-era Saving on a Valuable Education, or SAVE, plan in 2024.

Millions of student loan borrowers who signed up for SAVE were automatically enrolled in a forbearance during that legal battle. Those borrowers found their progress toward PSLF frozen throughout the payment pause, even as they continued to work in eligible public service.

More than 7 million student loan borrowers remain in the SAVE payment pause, according to higher education expert Mark Kantrowitz. Many borrowers have tried to leave the plan, he said, but are stuck in another massive backlog of more than 734,000 applications for a new repayment plan.

Despite the long wait times, it’s still worth applying for PSLF Buyback if you think you qualify, said Betsy Mayotte, president of The Institute of Student Loan Advisors, a nonprofit that helps borrowers navigate repayment.

“I have seen borrowers get it lately,” Mayotte said.

At the same time, you don’t want to depend on the option for your debt forgiveness, she said. You should also try to continue making payments on your loans.

If you’re still in the SAVE plan, one option is to apply to be in the Standard Repayment Plan to make your remaining PSLF payments. The current backlog is for borrowers switching into income-driven repayment plans, she said — and the Education Department should be able to move you quickly into the standard option.

Meanwhile, student loan borrowers who submitted a buyback request and are no longer working for a qualifying employer must “hold on tight,” Rodriguez said.

“Switching plans will not get them the credit they may need,” she said.

After borrowers submit their PSLF Buyback request, the Education Department is supposed to send them an offer letter. That letter details the number of monthly payments they missed during their public service history, and provides a chance to pay that bill now in exchange for student loan forgiveness.

Borrowers who have continued making payments in the meantime may qualify for a refund.

Punch said she has calculated that she needs to buy back five months to qualify for PSLF, and estimates she’ll owe around $1,500.

“I would love for them to process my buyback so I could pay,” she said.