U.S. Department of Education to Reconvene Negotiators to Deliver Student Debt Relief - Student Borrower Protection Center (2024)

FAQs

Is the student loan forgiveness going to be approved? ›

Borrowers will begin receiving emails from President Biden today telling them they are approved for forgiveness and will not need to take any further action to receive relief. In the coming days servicers will process the forgiveness and borrowers will see their loans forgiven on their accounts.

The Public Service Loan Forgiveness (PSLF) program is a United States government program that was created under the College Cost Reduction and Access Act of 2007 signed into law by President George W.

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).

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.

Under Public Service Loan Forgiveness, borrowers in public service for 10 years who have made 120 months of qualifying payments can get their remaining student debt canceled.

Canceling federal student loans will cost the government money that comes in part from taxpayer dollars. The Congressional Budget Office, which crunches the numbers, said President Biden's plan to cancel student loans could have added $400 billion to the government's expenses.

Since the White House made changes to PSLF, about 871,000 Americans have received student loan forgiveness through the program, the Biden administration said.

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.

Advocacy In the United States

NASPAA has also advocated for our graduates with student loans, pressing for the continuation and greater accountability of the Public Service Loan Forgiveness Program, and of income-based repayment options for low-paid public servants.

Cancel student debt for borrowers who entered repayment a long time ago. Borrowers with undergraduate debt would qualify for forgiveness if they entered repayment 20 years ago or more, and borrowers with graduate school debt would qualify for forgiveness if they entered repayment 25 years ago or more.

Why am I not eligible for student loan relief? ›

If you have Parent PLUS Loans, Federal Family Education Loans (FFELs), or Perkins Loans, you aren't eligible for IDR forgiveness with your loans in their current form. However, you may be able to gain eligibility by consolidating your loans with a federal Direct Consolidation Loan.

Lenders may look at your employment history, credit score, debt-to-income ratio, and enrollment status at your school. One of the most common reasons why a student might not qualify for a private student loan is because they don't meet their lender's FICO^® Credit Score criteria.

If your federal student loans are forgiven, you could get a refund, and you might see your credit score dip. Anna Helhoski is a senior writer covering economic news and trends in consumer finance at NerdWallet. She is also an authority on student loans.

How will student loan forgiveness affect your credit scores? If you're able to secure loan forgiveness, you might see your credit scores drop slightly. That's because student loans, like any other loan, contribute to your credit mix, or the different types of debt that you hold.

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.

The U.S. Department of Education's COVID-19 relief for student loans has ended. The 0% interest rate ended Sept. 1, 2023, and payments restarted in October. Never made student loan payments before? Learn what's involved and how to get ready.

Starting in July 2024, payments for borrowers with only undergraduate student loans will be cut in half. Those monthly payment amounts are currently calculated to be 10% of your discretionary income, but in July 2024 that number will drop to only 5% of your discretionary income.

Important note: As part of the Fresh Start Program, borrowers with eligible defaulted loans are receiving certain relief measures, including tax refunds (and child tax credits) not being withheld. This relief will continue through at least September 2024.

However, if borrowers have no disposable income, as defined by a formula based on the federal poverty level, they're payments are set to $0. These new figures mean more than half of those who have signed up so far have income levels low enough to qualify for $0 loan bills.