On August 24, 2022, the Biden administration proposed a plan to cancel $10,000 or possibly $20,000 of student loans for borrowers that qualify. The United States government released their official student loan forgiveness application on October 17th, 2022. The application process will close December 31, 2023. However, we recommend filing an application as soon as possible.
As you may be aware, the plan is currently facing potential lawsuits. According to higher education expert Mark Kantrowitz, “If a borrower receives forgiveness, they may get to keep it even if the court blocks the president’s plan.” In addition, it may take up to six weeks for your application to be processed. This means filing as soon as possible can help reduce or eliminate your payment before the pandemic-era payment pause expires on December 31, 2022.
Any loan that is considered a “Federal Direct Loan Program”. This includes Direct Stafford Loans and all Direct subsidized and unsubsidized federal student loans. Parent Plus and Grad Loans are also eligible for the relief.
· $10,000 Forgiveness: Non-Pell Grant recipients
· Additional $10,000 Forgiveness: Pell Grant recipients
· Income Qualification:
o Individuals who made less than $125,000 in 2021 or 2020
o Families that made less than $250,000 in 2021 or 2020
It is important to note that the income qualification is based on your adjusted gross income (AGI). This can be found on line 11 of IRS Tax Form 1040 (Tax Return).
To apply for Federal Student Loan Debt Relief, visit https://studentaid.gov/debt-relief/application
If you, or anyone you know, has any questions or concerns regarding the application process, please let us know. We would love to help.
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