SERVICE Act

This bill aims to make it easier for people in public service to get student loan forgiveness. It would cancel the remaining balance on Federal Direct loans after 96 qualifying monthly payments while you work in a public service job, and you would not have to still be in that job on the day your loan is cancelled. More types of approved “payment pauses” (like military service or cancer treatment) would count toward those months, and extra payments could count toward future months or go straight to your loan balance. You could also make a one‑time payment to get credit for past months when you worked in public service but didn’t make qualifying payments; once a month is counted, it can’t be taken away later .

If forgiveness is denied, you’d get a 90‑day pause with no interest added to your balance and a chance to ask for reconsideration within 90 days; the Education Department must decide within six months . Some independent contractors in public service roles would count toward forgiveness, and “full‑time” would mean at least 30 hours per week (with a special rule for non‑tenure‑track college instructors). The Department would create an online portal showing your eligible loans, how many qualifying payments you’ve made and have left, and let you and your employer e‑sign forms; it would also post a public, searchable list of public service jobs. Interest would no longer be added to your balance after any forbearance (payment pause), including ones already in place when the law takes effect. If you consolidate loans, past qualifying payments would carry over using a weighted average, including for parents who consolidate Parent PLUS loans. The bill also updates teacher loan forgiveness rules and orders a federal study to explore automatic job checks for forgiveness, including progress for military and veteran borrowers, with a report due in one year.

• Who is affected: People with Federal Direct student loans working in public service, including some independent contractors; teachers; and military/veteran borrowers .
• What changes: Forgiveness after 96 payments; more types of pauses count; option to “buy back” missed months; clearer rules for extra payments; online portal and job database; no interest added after pauses; consolidation credits carry over; reconsideration process if denied .
• When: The interest rule applies to current and future pauses once the law takes effect; the federal study’s report is due within one year .