Biden Student Loan Forgiveness Means 3 Things For Your Student Loans (2024)

FAQs

Biden Student Loan Forgiveness Means 3 Things For Your Student Loans? ›

In total, these plans would fully eliminate accrued interest for 23 million borrowers, would cancel the full amount of student debt for over 4 million borrowers, and provide more than 10 million borrowers with at least $5,000 in debt relief or more.

These loan types are eligible: Direct Subsidized and Unsubsidized Loans. Direct PLUS Loans made to students. Direct Consolidation Loans that do not include PLUS loans (Direct or FFEL) made to parents.

The PSLF Program forgives the remaining balance on your Direct Loans after you've made the equivalent of 120 qualifying monthly payments while working full time for a qualifying employer.

If you have loans that have been in repayment for more than 20 or 25 years, those loans may immediately qualify for forgiveness. Borrowers who have reached 20 or 25 years (240 or 300 months) worth of eligible payments for IDR forgiveness will see their loans forgiven as they reach these milestones.

If you received a Pell Grant in college and meet the income threshold, you will be eligible for up to $20,000 in debt relief. If you did not receive a Pell Grant in college and meet the income threshold, you will be eligible for up to $10,000 in debt relief.

Plan 2 refers to a student loan taken out from September 2012 onwards, in England or Wales. Older loans (from England or Wales) and loans taken out in Northern Ireland, are called plan 1 loans.

Final answer: Being in an entry-level position for 2-3 years may not make you eligible for loan forgiveness, whereas having a qualifying public service job, being on an income-driven repayment plan, and teaching in a low-income public school may make you eligible for loan forgiveness.

The proposal would permit student debt forgiveness for borrowers with only undergraduate debt if they first entered repayment at least 20 years ago (on or before July 1, 2005), and borrowers with any graduate school debt would qualify if they first entered repayment 25 or more years ago (on or before July 1, 2000).

When debt burdens are lifted, student borrowers can start new businesses and in turn, create job opportunities for others. They can buy homes for the first time in their lives, pay down other debts such as their credit card bills, and have less reliance on social safety net programs.

» MORE: What happens next if your student loans are forgiven? In most cases, you'll get a refund for any overpayments beyond 20 or 25 years.

Can I see if I was approved for student loan forgiveness? ›

What will happen if my Public Service Loan Forgiveness (PSLF) application is approved? The PSLF servicer will notify you of the approval and the next steps in the process, depending on how many qualifying payments you have at the time of the PSLF form approval.

Zero balance – the Education Department may have forgiven the student loan debt, but what's more likely is that the loans were moved to a different servicer. Disappeared – the loans defaulted several years ago and fell off the report.

Thanks to the Biden-Harris Administration's SAVE plan, starting today, the Administration will be cancelling debt for borrowers who are enrolled in the SAVE plan, have been in repayment for at least 10 years and took out $12,000 or less in loans for college.

Cancel up to $20,000 in interest for all borrowers who have accrued or capitalized interest on their loans since entering repayment. All borrowers would be eligible for this debt cancellation.

Having a student loan will affect your credit score. Your student loan amount and payment history are a part of your credit report. Your credit reports—which impact your credit score—will contain information about your student loans, including: Amount that you owe on your loans.

Many student loan borrowers have an opportunity to have their entire student loans cancelled or receive more credit towards cancellation, but they must act before April 30, 2024.

Direct Subsidized Loans are available only to undergraduate students who have financial need. Direct Unsubsidized Loans are available to both undergraduates and graduate or professional degree students. You are not required to show financial need to receive a Direct Unsubsidized Loan.

There are four types of federal student loans: Direct Subsidized Loans, Direct Unsubsidized Loans, Direct PLUS Loans and Direct Consolidation Loans.

Direct Subsidized Loans: You won't be charged interest while you're enrolled in school or during your six-month grace period. Direct Unsubsidized Loans: Interest starts accumulating from the date of your first loan disbursem*nt (when you receive the funds from your school).