How to Calculate PSLF Buyback

Editor's note: On March 31, 2026, the Department of Education clarified that PSLF buyback calculations will not use SAVE plan payment amounts.Borrowers should generally estimate buyback costs using the income-driven repayment plan formula applicable to their loans, such as IBR, PAYE, or ICR.The PSLF buyback program is one of the many changes President Biden’s administration rolled out for federal student loans.If you work in public service, PSLF buyback can help you get additional credit toward the 10 years needed for Public Service Loan Forgiveness (PSLF) that you might have otherwise missed.  We’ll help you evaluate whether you should apply for PSLF buyback or not and show you step-by-step how to calculate the correct amount you should be paying for your buyback offer.

Who can apply for PSLF buyback?  The PSLF buyback regulation was part of the mid-2023 overhaul of PSLF program rules under the Biden administration.  A borrower can apply for PSLF buyback if both of the following two conditions are met: You have periods of forbearance or deferment (such as the 2024-2025 Saving on a Valuable Education (SAVE) Plan forbearance) that would have normally counted for PSLF if you had been enrolled in an income-driven repayment plan.Adding the months of forbearance or deferment would bring your total payment credit under PSLF to 120 months.Most common PSLF buyback mistakes The biggest mistake borrowers make is misunderstanding the 10-year employment requirement.To qualify for PSLF buyback, you need 10 years of employment with a PSLF-eligible employer during periods when you had federal student loans.

Generally speaking, that means you need at least 10 cumulative years of public sector employment post-graduation, or you won’t qualify for PSLF buyback.That’s because the program is designed exclusively to help you get over the 10-year finish line, not to update your payment count before you reach that milestone.The other big mistake is not using exact language when applying (we’ll cover that below).How to apply for PSLF buyback If you have 120 total months of PSLF-qualifying employment on your Direct Loans, you qualify for PSLF buyback if you have forbearance or deferment that would put you at 120 months of qualifying repayment.

Here’s how to apply.Step 1: Make sure Student Aid has your employment on file You need to use the PSLF Help Tool to let them know about all potentially qualifying public sector employment.Step 2: Verify what periods you want to “buy back” After your employment certification form is processed and payment counts are updated, verify the months you want to buy back.  It's helpful to look at your National Student Loan Data System (NSLDS) file for this so you can be confident in what you're requesting to buy back.It should clearly show periods of forbearance.  Note that the COVID-19 forbearance should already be counted toward your PSLF payment counts, so that period does not need to be included in your buyback request.

Generally speaking, most borrowers will only have the SAVE plan forbearance to buy back.Step 3: Submit a PSLF reconsideration request Next, go to the PSLF reconsideration page and use the exact language below, or the request will be denied.  Don’t worry too much about being denied — the Department of Education will provide the correct language for reapplying.However, since you're here, let's get it right the first time.  Language to use: “I have at least 120 months of approved qualifying employment, and I am seeking PSLF or TEPSLF discharge through PSLF buyback.Please assess my eligibility for PSLF buyback.” If Student Aid decides that you are eligible to buy back months, they will send you a buyback agreement with the amount to pay and instructions to pay the full amount within 90 days of their email to you.

How to calculate your PSLF buyback amount The buyback amount should be determined by:  Your income-driven repayment (IDR) plan before or after the period of forbearance (whichever is lower), OR  The 10-year Standard Repayment Plan, if the IDR plan amount would be higher than that.With the SAVE plan no longer an option, this complicates the math, and borrowers should know the following strategy so they can advocate for themselves.Borrowers should run the PSLF buyback calculation based on their payments under the Income-Based Repayment (IBR) plan to know the maximum amount they should be asked to pay under PSLF buyback.We’ll do some examples below, so you can reflect on the amount you’d owe.

But first, let’s talk about what your buyback amount is based on.Why IBR is a useful benchmark for PSLF buyback calculations Many borrowers did not have to pay much during the 3.5-year COVID-era pause, and most didn't need to recertify their IDR payment either prior to the June 2024 start of the SAVE plan forbearance.With the termination of the SAVE plan under the Trump administration, borrowers can no longer assume their prior SAVE payment will be used in PSLF buyback calculations.Instead, borrowers should estimate their potential buyback amount using the income-driven repayment plan that would otherwise apply to their loans, such as IBR, Pay As You Earn (PAYE), or Income-Contingent Repayment (ICR).

We recommend that borrowers calculate their PSLF buyback numbers using IBR as a reasonable estimate of what they may be asked to pay.Now, let’s get to those examples.How to figure out all the PSLF buyback amounts you could owe In each example below, the buyback rate is whichever is lower — the IBR estimate or the 10-year Standard Repayment Plan amount.Watch which one wins, and why.

Example of PSLF buyback when IBR is the lower payment Assume Sally owes $200,000 of medical school debt, of which $180,000 is principal and $20,000 is accrued interest.Her interest rate is 7%.Her payment under the former Revised Pay As You Earn (REPAYE) income-driven plan was $300 per month as a resident physician in 2019.When the world shut down in 2020, her payments were paused until the SAVE plan rolled out in 2023.

With SAVE, her new payment dropped to $206 per month.Her payment remained that low despite becoming an attending physician in 2021 and earning a starting salary of $200,000 a year.Using the IBR calculator on our website, she sees that a $300-per-month REPAYE payment would've been $450 per month if she had been enrolled in IBR instead.Because her SAVE plan forbearance lasted less than a year and she was enrolled in an IDR plan when it started, the Department of Education is supposed to use the lower of her IDR plan payment before or after the forbearance.  Let’s hypothetically say the SAVE plan forbearance ended for Sally in April 2025.

She'd be eligible to buy back roughly 10 months of forbearance at her $450 IBR payment: $450 x 10 = $4,500 (if IBR is used).Her 10-year Standard Repayment Plan payment would be over $2,000 a month, so IBR is the cheaper benchmark here.Example of a PSLF buyback with a high income Let’s presume LaToya is a surgical subspecialist with $300,000 of student loans at 7%.She was on the REPAYE plan in 2019 paying $3,000 per month, and her SAVE payment only dropped her to about $2,900 — not much of a difference.

If she borrowed her first loan before 2014, she would only be eligible for old IBR and not new IBR.The distinction is new IBR is 10% of income and old IBR is 15% of income.That pushes her IBR estimate to about $4,500 a month, higher than her $3,483 Standard Repayment Plan payment.When IBR comes out higher, the Standard Repayment Plan is used instead.

What if you have a forbearance lasting more than a year that you need to buy back? If you have a forbearance lasting more than a year that you need to buy back, the Department of Education is theoretically supposed to ask for tax returns from each of the years that the period stretches over, along with family size information to calculate the appropriate buyback amount.However, this PSLF buyback program was never envisioned as a plan to provide millions of borrowers with additional credit.So the current Department of Education’s administration of this rule could certainly be different from what’s been posted on the website.Related: PSLF Buyback: A Complicated Option for Borrowers Will the Trump administration honor PSLF buyback? What we’ve told clients is that the buyback program is unlikely to be repealed immediately, although it’s unlikely to stick around long-term.

Borrowers close to the PSLF finish line should try to take advantage of PSLF buyback under the publicly stated rules until that’s no longer an option.And given that PSLF buyback calculations have changed multiple times as federal repayment programs have evolved, any reasonable buyback amount should probably be accepted by the borrower instead of challenged, as it’s extremely unlikely that a PSLF buyback offer would be reversed in the future.  That said, buyback offers that have not yet been made are significantly more up in the air.So borrowers should pay attention to what their buyback amount would be in case they can take advantage of it.  If this program does stick around long term, then borrowers will need to carefully keep track of the SAVE forbearance period, along with what their payments would have been, as virtually all PSLF borrowers would want to be applying for buyback during the affected period.If you need expert guidance on PSLF buyback, work with a member of our team to get help or check out the resources on the Student Aid website.