Delay submitting employer cert for PSLF to stay with Navient instead of FedLoan

[Iguy2020]

I have a question regarding submitting the employer certification forms for PSLF. I am a transitional year intern currently on REPAYE working at a 501c3, with 3 more years of residency at a different 501c3 after this year. I have roughly $187,000 in debt. I am not sure if after these 4 years of residency I will enter the private world or work in academics/non-profit for another 6 years and stay eligible for PSLF.

I currently have Navient as my loan servicer and am very happy with them. I've had no issues, find their app and website easy to use, and their customer service to be surprisingly adequate. I know that if you certify your employer for PSLF your loans get transferred to FedLoan Servicing. A quick search on google and on this website reveals a large number of horror stories surrounding FedLoan. They seem to be woefully incompetent and unwilling to really help their customers, so I am scared to switch servicers to say the least.

Considering my fear about switching from Navient to FedLoan and the fact that I may not even do PSLF if I end up entering the private world, would I be making some crazy mistake by just retroactively submitting the employer certification forms for PSLF, lets say, 9-10 years from now,  assuming I'm still working for a qualifying employer? From my understanding, when you submit the certification form they retroactively look at any loan payment made under an IBR plan while working for a qualifying employer. I understand the headache involved with going back to my intern year hospital 10 years later and asking HR to find records of me ever working there and filling out the form, so I would be diligent about keeping my employment contract and all W2s in an organized spot on my computer/file cabinet. Besides this inconvenience, am I missing something?

[Raymond Oliver]

I've used FedLoan since I submitted my PSLF certification almost 2 years ago.  I've had zero problems with them.

[DMFA]

I know the fact sheet/FAQ from the DoE says they all get serviced by FedLoan, but I swear I've seen people with different servicers with PSLF on their statements.

If you're in the private world once out of training, you'll refinance to a lower rate anyway.

[Joy Sorensen Navarre Navigate]

If you pursue PSLF, at the end you will have to prove that you've made 120 qualifying payments while working for a qualified employer. In my experience, its common for loan servicers to make mistakes counting the qualifying payments. The sooner you can find a mistake, the more likely a positive result.

It's true DMFA that all servicers count payments toward PSLF. However, after loans transfer to PHEAA, and if there is a mis-count with the original servicer, it can be difficult to correct.

The reasons for a mis-count are myriad: mistake in the paid-by date, over-payments causing paid ahead status with no bill created thus not a qualifying payment, incomplete information sent by original servicer, and more.

We spend a significant amount of time on the phone with our clients and their servicers to correct the count. It often results in a "Review" that can take months. We now recommend that physician borrowers take seriously the suggestion to submit a PSLF employment certification form annually. The sooner we identify a mistake, the sooner it can be resolved.

[cscholz]

I agree with Joy.  Also, it is important to note that if you move your federal loans to private loans, you lose the protections that come with them:

1.  discharge at death or disability (unless specifically stated in the contract)

2.  flexibility -- access to income driven repayment plans

3.  deferment or forbearance availability (unless specifically stated in the contract)

4.  no loan forgiveness options

 

Once you refinance your loans into private loans, you cannot bring them back into the federal system.

Risks in private loans include:

1.  Flexible interest rates (typically there is not a cap -- read the promissory note carefully)

2.  Many more default triggers

 

I am not against refinancing loans if it is the right time and you are in the right place -- financially.