By now we have probably all heard the news that President Biden’s most-recent Student Loan Forgiveness policy was blocked by the Supreme Court but, ICYMI, on Friday July 14th the Administration made a new announcement regarding an update to another route to student debt forgiveness!
It was announced that a sweeping over-haul will be made to the Income Driven Repayment Forgiveness option (which has long been in place for borrower’s who have paid either 20 or 25 years of payments, on a income-based plan) to be more accessible, much like they did previously with the Public Service Loan Forgiveness option. Read below for the latest details.
You may be one of the 804,000 borrowers who qualify for this $39B forgiveness package!
Who is Affected:
Borrower’s with Federal Student Loans backed by the Department of Education (Direct Loans, FFEL, Parent Plus) on either a Standard Repayment Plan or an Income Driven Repayment Plan, who have made 20 or 25 year’s worth of payments. The eligibility has been expanded to include many more months of payments than was previously allowed, including:
–Any month in repayment, regardless of loan type.
–Any month partial or late payments were made.
–Any month or specific periods of time in “forbearance” (unable to pay due to hard-ship).
–Any month in “deferment” (unable to pay due to being in school, military, or another accepted exclusion).
–Any month before loan consolidation.
What’s Next:
The Education Department is already updating all borrowers’ accounts, giving credit where due in accordance with the new eligibility guidelines. They already began notifying eligible borrower’s (watch your email and USPS!) of any loan forgiveness eligibility and will continue to do so every two months for the next year.
Have Questions About Your Loans?
The Institute of Student Loan Advisors (TISLA) and/or StudentAid.gov are here to help!
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