What you need to know to apply for student loan forgiveness


Applicants for student debt relief can now apply ahead of the official announcement of the application process later this month. This form is available here.

After campaigning on the promise of debt relief (and receiving widespread criticism from borrowers and activists for his inaction), President Joe Biden finally laid out his plan to solve the growing debt problem. nationwide – a number that currently sits at an easy 1.75 trillion.

The new forgiveness plan, announced just a week before student loan repayments resume after a nationwide pause during the COVID-19 pandemic, will forgive some borrowers up to $20,000 and extend the repayment pause until December 31st. a “three-part plan” to deal with debt for low- and middle-income borrowers, and also includes adjustments to income-based payment plans.

On the evening of Friday, Oct. 14, the Biden administration opened the application process for Americans seeking student debt relief during a beta testing period, White House officials told CNN.


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During the campaign, Biden pledged to completely forgive all undergraduate debt at public two- and four-year universities as well as private HBCUs (historically black colleges and universities) and MSIs (minority-serving institutions). . This announcement is a much smaller commitment, but it could still have a significant impact on low-income borrowers. (Politifact, a nonprofit Poynter Institute fact-checking initiative, called the announcement a “compromise” based on Biden’s promises.)

If you’re currently paying off student debt and think you might qualify for this new form of relief, here’s what you need to know:

How can I qualify?

The new plan only applies to federal student loan borrowers in certain income brackets, as explained in the White House backgrounder:

Borrowers are eligible for this relief if their individual income is less than $125,000 ($250,000 for married couples). No high-income individual or household – in the top 5% of income – will benefit from this action.

Each borrower earning less than this amount per year is eligible for debt relief of up to $10,000.

Additionally, federal borrowers who have taken out Pell Grants (need-based grants for low-income borrowers who don’t have to repay) can receive an additional $10,000 for a total forgiveness of $20,000.

What if I am currently a student?

As reported by NPR, current students and dependents (based on parent or parent income) are also eligible. This backup plan does not apply to loans taken out after June 30, 2022.

If your parents or legal guardians took out Parent PLUS loans to help pay for your undergraduate degree, they can also claim $10,000 after meeting other requirements.

What if I have less debt than that?

The debt relief plan will not credit any funds beyond your current loan amount. If you have student debt of less than $10,000, the White House will simply pay off your total debt.

Should I apply for loan forgiveness?

Not exactly. The Student Debt Relief Plan will automatically apply to eligible accounts if the U.S. Department of Education already has your up-to-date income information on file.

If you are unsure if this is the case, it would be prudent to submit a formal application once the option is live. This exact date has yet to be announced, so the federal government suggests that borrowers sign up for alerts on the US Department of Education website.

Sign up for alerts to stay up to date.
Credit: US Department of Education

Be sure to select the option to be alerted to “Federal Student Loan Borrower Updates” before clicking submit.

When will this debt relief be applied to my account?

The Biden administration has not announced the exact date the relief will apply to borrowers’ accounts.

How do I access my student loan repayment plan?

For up-to-date information on your loans, visit the Federal Student Aid website, which may require patience as the site is down due to high traffic. Here you will find a breakdown of the types of loans you have taken out and their initial balance.

To pay off your loan balance through various repayment plans, you will need to consult with your loan service provider. This may have changed recently, as the federal government transferred loans on behalf of borrowers. Current service providers include MOHELA, Aidvantage, Nelnet and OSLA.

What else is changing for federal student loans?

The White House plan also includes some changes to the current process for repaying loans and applying for loan forgiveness through other means.

The Department of Education will offer a new version of its income-focused repayment plans (which adjust a borrower’s monthly payments based on what’s feasible for their current income). The plan would cap monthly payments for undergraduate loans at 5% of the borrower’s “discretionary income” (you can calculate it yourself here), instead of the previous 10%, and adjust the amount of income used to calculate these reimbursements. . As the White House explains, with these changes “no borrower earning less than 225% of the federal poverty level – approximately the annual equivalent of a $15 minimum wage for a single borrower – will have to make a payment. monthly”.


How does “Buy now, pay later” work?

They are not finished there. These proposals also include a change that would cancel loan balances after 10 years of payments for those with an original loan balance of $12,000 or less (instead of the current 20 years), and cover unpaid monthly interest accrued on income-based repayment plans.

The Biden administration also intends to fix and streamline the Public Service Loan Forgiveness Program (PSLF), which provides loan forgiveness to federal, state, local, tribal, or nonprofit government employees in United States, allowing these borrowers to claim more credit.

This story will be updated with new information as it becomes available.

UPDATE: October 15, 2022, 1:04 p.m. EDT This article has been updated to add more information about the Biden Administrations Student Debt Relief Program. On Friday, October 14, the Department of Education opened a beta testing program for Americans to apply for student loan forgiveness.


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