PSLF Buyback: What It Is and How It Works

If you’re pursuing Public Service Loan Forgiveness (PSLF) and have previously been in deferment or forbearance, you could be eligible for the PSLF buyback program. If you've completed 10 years of qualifying public service, the program allows you to “buy back” certain months that didn't previously count toward forgiveness, potentially helping you receive forgiveness sooner. 

However, PSLF buyback has strict rules, and not every deferment or forbearance period is eligible. Here’s what to know about how PSLF buyback works, who qualifies, and what to consider before applying.

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What is PSLF buyback?

PSLF buyback lets eligible federal student loan borrowers pay to get credit for certain months spent in deferment or forbearance. If approved, those months can count toward the 120 qualifying payments needed for Public Service Loan Forgiveness (PSLF).

“There are a lot of borrowers who, for one reason or another, have had periods of time where they were working for a qualifying employer for PSLF, but were unable to make payments, typically due to being in some kind of deferment or forbearance,” says Glenn Sanger-Hodgson, a certified student loan professional (CSLP) and founder of Shonan Gold Financial LLC.

“The PSLF buyback program offers an opportunity to these borrowers to turn those months that currently don't count towards PSLF into months that do by making a lump sum payment.”

Who is eligible for PSLF buyback?

To qualify for PSLF buyback, you must meet all of the following requirements:

• You have Direct Loans: Your loans must be federal Direct Loans with an outstanding balance.
• You have 120 months of qualifying employment: You must have worked full time for an eligible government or nonprofit employer for at least 10 years.
• You have eligible deferment or forbearance periods: The months you want to buy back must be on your current Direct Loans and must have occurred while you were working for a qualifying employer.
• Buying back those months would get you to forgiveness: The buyback months must bring you to 120 qualifying PSLF payments.  

Which months can you buy back?

You can only buy back certain months that would bring you to 120 qualifying PSLF payments. In general, eligible months may include:

• Months spent in deferment
• Months spent in forbearance
• Certain months after consolidation if you have a Direct Consolidation Loan

To count, those months must be tied to your current Direct Loans, and you must have been working for a qualifying employer at the time. Buying back those months must also be enough to get your loans forgiven.

“Borrowers are eligible for the PSLF buyback option only if the number of months bought back will cause them to reach the 120 payment requirement for forgiveness under PSLF,” says Mark Kantrowitz, author of “How To Appeal for More College Financial Aid”.  

Not every deferment or forbearance period qualifies. Loans that are already paid in full, forgiven, or discharged are not eligible for buyback.

“Time spent in the SAVE forbearance does qualify. The months must have occurred since October 2007, when the PSLF program became available,” explains Kantrowitz. 

“Borrowers with a federal Direct Consolidation Loan can buy back only months after the date of the consolidation. Months in an in-school or grace period, default, or bankruptcy are not eligible,” says Kantrowitz.

How do you apply for PSLF buyback?

To apply for the PSLF buyback program, follow these steps:

• Confirm eligibility: Make sure you have Direct Loans with a current outstanding balance and have met the 120-month employment requirement. 
• Certify previous employment: Make sure to certify any previous employment that isn’t accounted for using the PSLF Help Tool. 
• Review months to buy back: Check your Federal Student Aid account to find eligible deferment or forbearance periods. Go to “My Aid,” select “View Details,” then go to “Loan Breakdown” and “View Loans” to review your loan history. Make sure you were working for a qualifying employer during the months you want to buy back. 
• Request PSLF buyback: Use the PSLF Reconsideration request page and log in to your account. Choose “PSLF buyback” as the reconsideration type and confirm that you have 120 months of qualifying employment.
• Receive buyback agreement: If you’re eligible for the PSLF buyback program, you’ll hear back and receive a buyback agreement with instructions and the amount you must pay. 
• Make the payment: You’ll have 90 days to pay the full amount listed in your buyback agreement. Once you make the payment, those months can be counted toward PSLF.

Is there a deadline to apply?

There’s currently no set deadline to apply for PSLF buyback, but eligible borrowers may not want to wait.

“While there's no indication that PSLF buyback is going away, ongoing changes at the Department of Education can make the future feel less certain,” says Becca Craig, certified student loan professional (CSLP) and certified financial planner (CFP) at Focus Partners Wealth.  

“If a borrower is eligible and considering pursuing PSLF buyback, it could be beneficial to apply sooner rather than later,” adds Craig.

How much does PSLF buyback cost?

The cost of PSLF buyback depends on your loan and income history. In most cases, your buyback amount is based on what your monthly payment would have been under an income-driven repayment (IDR) plan during the deferment or forbearance months you want to buy back.

Your current income and family size usually aren’t used. Instead, the Department of Education looks at your income and family size from the time those months occurred.

For example, say you want to buy back 10 months of deferment or forbearance. If your IDR payment would have been $300 per month during that period, your total buyback amount would be $3,000.

In some cases, the Department of Education may ask for tax information to confirm your income. Submit that information as soon as possible. If you don’t respond within 30 days, your buyback amount may be based on what you would have paid under the Standard Repayment Plan, which could be higher.

If your calculated payment would have been $0, you may still receive a buyback agreement, but you won’t have to make a payment.

How 2026 SAVE Plan changes affect PSLF buyback

If you were enrolled in the SAVE Plan, your PSLF buyback amount may be harder to estimate.

“The SAVE Plan was officially terminated earlier this year following a court-approved settlement, which threw a very large wrench in the mechanics of PSLF buyback for borrowers enrolled in the SAVE Plan,” says Craig.

That’s because the SAVE formula can’t be used for certain buyback calculations. According to Federal Student Aid, if the deferment or forbearance period you want to buy back began or ended on or after July 1, 2024, the Department of Education can’t use the SAVE Plan formula to calculate your payment. 

Instead, if you weren’t enrolled in IBR, ICR, or PAYE during that time, the Department of Education will ask for your income and family size information to determine your buyback amount.

This could lead to a higher payment than you expected, especially if your buyback amount would have been lower under SAVE.