Hennepin County leaders rushed this month to hire a consultant to help employees take advantage of generous student loan forgiveness rules before they expire at the end of the year.
The County Board agreed Tuesday to pay Savi, a student loan consultant, $500,000 to help workers apply to have student loans forgiven through the Public Service Loan Forgiveness program.
Under the federal program, employees of government agencies and nonprofit organizations with 10 years — or 120 months — of on-time loan payments can have the rest of their loans forgiven. Temporary rules enacted by the Biden administration allow borrowers to count the time loan repayments were paused during the coronavirus pandemic toward the necessary qualifying payments.
Only government-subsidized direct loans are eligible for the forgiveness program. Borrowers can consolidate their loans to become eligible, but they must do so before the end of the year for the pandemic payment pause to count.
That's where Savi comes in.
Under the agreement, the consultant will set up a dedicated website for county workers and help them navigate more than 50 different income-driven repayment plans, including various loan forgiveness programs.
County Administrator David Hough said the agreement will cost the county $150 per employee who uses it, with the total cost not to exceed $500,000 by the end of 2024.
Hough noted that nationwide, more than 43 million people have student loan debt and roughly $1.7 trillion is owed nationwide. Another 3.7 million parents have loans that could also be eligible.
