Hi Heather,

Thank you for all that you do for the visitors to this site!

I’ve been working as a government attorney and making payments under PILF for a little over four years and will continue on this career path for at least six years when I get my outstanding balance forgiven. 

Aside from a used car, I have no real assets to my name.  However, my fiance is on a much more stable financial footing than I.  She has savings and a 401(k)), owns an apartment that will become our primary residence, and a small rental property. 

In addition, I have an elderly mother who owns a home and has a life insurance policy. I am the named beneficiary of the policy and the home in her will. 

Does PILF take into account assets when it forgives the balance of my loan?  In other words, as a matter of public policy, does PILF take into account the borrower’s personal wealth, or does it only matter that the applicant works in public service (and meets all other requirements, etc.) when it forgives the outstanding balance? 

Thank you so much for your time. 

Sincerely,

wwlee

PSLF is earned by making 120 “qualifying payments”.  A borrower must make on-time monthly payments over at least 10 years on eligible Direct Loans while working full-time in qualifying public service employment.  The only way assets are factored in is insofar as they generate taxable income.  Payments under a qualifying income-driven repayment plan are based on AGI, so the higher the income, the higher the payments, and the lower the forgiveness.  But no, otherwise assets aren’t part of the calculation.