Lawsuit – Public Service Student Loan Forgiveness

As the first batch of public service student loan forgiveness borrowers became eligible for forgiveness on October 1, 2017, many discovered the unfortunate reality that their loans and their repayment programs didn’t qualify for forgiveness, and they would have to start all over. This came as a shock to most, especially due to the fact that their student loan servicers consistently told these borrowers throughout the years that they were on track for forgiveness. As a result, the first of many class action lawsuits has been filed against Great Lakes Higher Education Corporation, one of the four major government contracted student loan servicing entities.

Some Aspects of The Lawsuit

In 2007, President George Bush’s administration created a program that would forgive qualifying public service or non-profit employees federal loans. Essentially the government will pay for people’s federal loans as long as they qualify and complete the program. In theory this is awesome, but in reality things have not been that easy for borrowers in the program.

One of the main problems borrowers have been reporting is that they’re allegedly not getting correct information about program requirements from their loan servicers. Allegedly many public service borrowers have been told that in order to qualify for the public service forgiveness program, all they need to do is work in public service for 10 years and make their loan payments on time every month. The problem is that public service loan forgiveness has more requirements than other types of student loan forgiveness programs. One of the common misconceptions is that any federal loan can be forgiven through the public service forgiveness program.

Many borrowers originally took out Family Federal Education Loans (FFEL). This type of loan may sound like it should work, but it doesn’t. The reason being that this loan was created by a private company and backed by the federal government. Since this loan was connected to private banks, the government decided to exclude it from the program. In 2010 the FFEL loan was phased out. Currently the William D. Ford Direct Loan is the only loan that qualifies for the public service forgiveness program.

Recently this program requirement has caused a lot of issues for borrowers. Mainly because borrowers were not told they needed to consolidate their federal loans into a Direct Loan in order to qualify for the program (allegedly). This caused many borrowers to be under the assumption that they were on track to receive forgiveness. But in reality they weren’t making any progress toward forgiveness at all. As a result many borrowers have filed lawsuits against loan servicers like Great Lakes and Navient.

The full complaint can be found here.

Have Questions About Public Service Student Loan Forgiveness?

At Hope Credit we’re experts at public service student loan forgiveness. We’ve helped many people achieve partial and total loan forgiveness over the years. Sometimes the government can change the requirements of forgiveness programs. This can make it difficult to stay current if you’re not familiar with or simply just don’t have the time to research new updates in the industry. At Hope Credit we’re always working to ensure our clients have the latest information about their student loans. If you’re looking for help with your student loan we would be happy to talk with you. Feel free to contact us by clicking here.


CNN (Cable News Network) (2018, January 2). Student loan nightmare: ‘I have to start all over’ [News]. Retrieved from