Is buying back PSLF worth it? What it will cost you

The Public Service Loan Forgiveness (PSLF) program requires you to make 120 qualifying monthly payments while working for an eligible employer. But many borrowers default because the months they spent in deferment or forbearance (even while working full-time in public service) didn’t count. This is particularly damaging because of SAVE Forbearance, which found 8 million borrowers in forbearance due to court rulings beyond their control.

The buyback clause has been introduced to address this gap. It allows borrowers to make a lump sum payment that covers previous periods of deferment or forbearance, effectively turning those months into eligible payments. For someone sitting at 117 or 118 payments, a buyback could push them over the forgiveness limit.

In theory, this is a practical solution to years of technical exclusion. In practice, the process is opaque and there are currently 74,000 PSLF buyback applications backlogged while the Department of Education only processes about 5,000 applications per month.

Why are borrowers confused?

Buying back PSLF is a confusing process.

Eligibility questions. Borrowers can only request a buyback if they reach 120 months when months purchased are included. This means that some cannot even begin the process until “normal” PSLF is finished. Periods prior to loan consolidation do not count, and not every type of deferral is eligible.

The situation is not clear. Once a borrower submits an application, it is not clear how long it will take and what happens. It’s actually a black box. The only real status signs are hearing about others getting endorsements (on forums like Reddit). This is the only measure borrowers really have.

Backlog and delay. As of August 2025, less than 10% of outstanding repo requests have been processed. Some borrowers have waited nearly a year for a response. During this time, they don’t know whether to resume monthly payments or wait for them to be approved. Moreover, with the government shutdown, the backlog will grow.

Surprise costs. The buyback amount is usually calculated using the lowest of the borrower’s income-driven repayment (IDR) payments before or after deferment. However, once a borrower exceeds 12 months of repurchase requests, or if the borrower is not subject to IDR, the Department may use prior tax returns to estimate what payments would have been. Many borrowers end up with higher-than-expected lump sums. Since staking has been deemed illegal, staking is not the plan used to calculate repurchase orders. Borrowers view REPAYE as the monthly payment amount.

Buyback versus resumption of repayment based on income

For some borrowers, a buyback is attractive because it can retroactively add eligible months and close the forgiveness gap. But for others, it may be faster (and more predictable) to simply resume payments under an IDR plan.

example: A borrower earning $80,000 wants a 12-month buyback. If your monthly IDR payment is $478, your total buyback amount will be $5,736. Resuming IDR payments would also cost $5,736 over 12 months – no savings, just different timing.

But if the borrower only qualified for the older IBR plan at $718 per month (because they were a borrower before June 2014), the 12 payments would total $8,616. In this case, it is clearly cheaper to buy back.

For borrowers with volatile income, the math changes. The recent pay cut could mean lower future IDR payments, making a buyback less attractive. Conversely, if income rises, a repurchase could result in a lower historical payout account.

Impact on borrowers and their families

For many households, the choice between buybacks and monthly payments comes down to cash flow and risk tolerance.

• Liquidity:Can you access thousands of dollars for a lump sum, or is the expected monthly payment easier to manage?
• timing: How close are you to 120 push? If forgiveness is less than a year away, monthly payments may get you there faster than waiting for a buyback to be approved.
• suspicion:Families who rely on forgiveness to reset their finances may not want to gamble on a backlog that may last for months (or years).

The pressure of waiting, coupled with a lack of clear instructions, has left many borrowers unsure of how to plan. Some risk paying unnecessary sums, while others risk delays in achieving amnesty.

What Borrowers Can Do Now

The PSLF repo option is intended to help borrowers who have lost credit due to small gaps in repayment history. But due to unclear rules, missing instructions, and severe delays, many are left confused and frustrated.

For some, a buyback can provide real savings, especially under older payment plans. For others, resuming IDR payments on PAYE or IBR may be a more reliable route to loan forgiveness.

in the meantime:

1. Check PSLF numbers: Log in to your loan account to check your eligible payment history and see how close you are to 120.
2. Document collection: Make sure you have your employment certificate for the months of the buyback, income tax returns for the relevant years, and have submitted a buyback application.
3. Cost estimate: Compare your potential lump sum buyback with the expected monthly payments under REPAYE.
4. Consider timing:If you’re within 12 months of forgiveness, monthly payments may be faster and less stressful than waiting for a buyback. Additionally, the dollar amount may be the same!
5. Record keeping: Save all forms, emails and submission confirmations – processing errors can occur.

Borrowers should carefully weigh their income, liquidity and ability to tolerate delays before choosing which path to take.

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