Well, I know it is just proposed and not final, but damn.  To see them eliminating PSLF is very disheartening.  I know that this is very fresh news, but I am hoping that once Heather gets a chance to talk to people she’ll let us know the intent of the budget regarding the impact on existing borrowers in the program.

I have seen a few different experts at various sites respond already saying the expectation would be that those currently in the program would be grandfathered in even if this were to occur (as they borrowed with the expectation of receiving this), but I usually would rely on what Heather says more so than some random person quoted in Forbes or whoever is publishing the article.

Thanks,
Ken

Yeah, This is kind of my entire future riding on this.

Obama’s budget tried to cap the program at 50k, and that went nowhere. Hopefully this goes nowhere as well.

The documents on the President’s budget that were just released online suggest loans before July of 2018 would be grandfathered in to PSLF and existing repayment programs.  Which is not to say that Congress can’t pull the rug out from under us, but it is heartening that even Mr. Mulvaney’s shop is not proposing to do that, though it is a shame for future borrowers that they want to get rid of the program.

Can you give more detail?  What language are you seeing that suggests changes will apply only to new borrowers?

duplicate post - sorry

Check out page 20 of the main budget document (https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/budget/fy2018/budget.pdf ), which states ““All student loan proposals apply to loans originated on or after July 1, 2018, except those provided to borrowers to finish their current course of study,” and page 355 in the Dept of Education appendix (https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/budget/fy2018/edu.pdf ) for more detail.

To find the text below, I went to the OMB website and opened the main budget document and the Dept of Education appendix, and searched for “Public Service Loan Forgiveness” in the document.

From page 20 of the main budget document: “To support this streamlined pathway to debt relief for undergraduate borrowers, and to generate savings that help put the Nation on a more sustainable fiscal path, the Budget eliminates the Public Service Loan Forgiveness program, establishes reforms to guarantee that all borrowers in IDR pay an equitable share of their income, and eliminates subsidized loans. These reforms will reduce inefficiencies in the
student loan program and focus assistance on needy undergraduate student borrowers instead of high-income, high-balance graduate borrowers. All student loan proposals apply to loans originated on or after July 1, 2018, except those provided to borrowers to finish their current course of study.”

And from p. 355 in the appendix on the Education Department: “The 2018 Budget would replace the five current Income Driven repayment (IDR) plans with one new single IDR plan to make choosing a repayment plan less complex. The new IDR plan would become the only income driven repayment plan for borrowers who originate their first loan on or after July 1, 2018, with an exception for students who borrowed their first loans prior to July 1, 2018 and who are borrowing to complete their current course of study. The single IDR plan would: cap payments at 12.5% of discretionary monthly income while eliminating the standard repayment cap; limit loan payments to 15 years for borrowers with undergraduate debt only and 30 years for borrowers with any graduate debt—any remaining amounts owed after these repayment periods would be forgiven; calculate payments for married borrowers filing separately on the combined household Adjusted Gross Income; and eliminate Public Service Loan Forgiveness. The 2018 Budget would also eliminate Subsidized Stafford loans. As with the single IDR plan, this policy would apply to loans originated on or after July 1, 2018, with an exception for students continuing to borrow to complete their current course of study.”

Budget link here:

https://www.govinfo.gov/app/collection/budget/2018

Pertinent info (Page 20 of the “Budget of the US Government”)
Reform Student Loan Programs. In recent years, income-driven repayment (IDR) plans, which offer student borrowers the option of making affordable monthly payments based non factors such as income and family size, have grown in popularity. However, the numerous IDR plans currently offered to borrowers overly complicate choosing and enrolling in the right plan. The Budget proposes to streamline student loan repayment by consolidating multiple IDR plans into a single plan. The single IDR plan would cap a borrower’s monthly payment at 12.5 percent of discretionary income. For undergraduate
borrowers, any balance remaining after 15 years of repayment would be forgiven. For borrowers with any graduate debt, any balance remaining
after 30 years of repayment would be forgiven. To support this streamlined pathway to debt relief for undergraduate borrowers, and to generate savings that help put the Nation on a more sustainable fiscal path, the Budget eliminates the Public Service Loan Forgiveness program, establishes reforms to guarantee that all borrowers in IDR pay an equitable share of their income, and eliminates subsidized loans. These reforms will reduce inefficiencies in the student loan program and focus assistance on needy undergraduate student borrowers instead of high-income, high-balance graduate borrowers. All student loan proposals apply to loans originated on or after July 1, 2018, except those provided to borrowers to finish their current
course of study. The Budget also supports expanded access to Pell Grants for eligible recipients through Year-Round Pell. This policy incentivizes students to complete their degrees faster, helping them reduce their loan debt and enter the workforce sooner. Year-Round Pell gives students the opportunity to earn a third semester of Pell Grant support during an academic year, boosting total Pell Grant aid by $1.5 billion in 2018 for approximately
900,000 students.

My thanks to both of you.  I have to say, I’m pleasantly surprised.  (I also don’t understand how the administration concluded that eliminating PSLF only with respect to post-July 2018 loans is going to result in any immediate savings, let alone the 859 million projected for 2018.  But, whatever.)

Agreed, the $859 million savings in 2018 is troubling (though apparently consistent with the other ridiculous assumptions in the budget).  That being said, the Washington Post appears to have confirmed with Dept of Ed officials that we’ll be grandfathered into PSLF:  https://www.washingtonpost.com/news/grade-point/wp/2017/05/23/on-track-for-public-service-loan-forgiveness-good-news-youre-not-in-danger-from-trumps-budget/?utm_term=.5ce090ae3016#comments

I wonder if this level of clarity on this issue (which I don’t recall the Obama administration providing) stems from greater awareness among the media and lawmakers of how awful it would be to pull the rug out from under people who have been counting on PSLF, because of the ABA lawsuit (https://www.nytimes.com/2016/12/20/your-money/student-loans/they-thought-they-qualified-for-loan-forgiveness-years-later-the-answer-is-no.html?_r=0 )

At the very least, I imagine that the ABA suit impressed on them the likelihood that they’d have a lot more litigation to deal with if they tried to apply cancellation of the program to pre-July 2018 loans.

I agree that the Obama administration was a lot more vague re. how its proposed cap on the program would impact those who had already taken out loans.  In fact, I wouldn’t be surprised if the recommendation to include the clarifying language in the current budget proposal was made by a career employee who witnessed first-hand how riled up people got when similar language was omitted in the past.  Score one for the bureaucracy?  (As long as I’m speculating, here’s another theory: The guy/gal who concluded that the current proposal for eliminating PSLF will save $859 million in 2018 is a recent appointee who doesn’t really know how PSLF works, and therefore does not understand the implications of grandfathering in pre-July 2018 loans.)