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Everything You Need to Know About Biden’s Student Loan Forgiveness Program

Under President Joe Biden’s federal student loan forgiveness program, it promises to deliver up to $20,000 of debt relief for millions of borrowers. However, the program is on hold as legal challenges work their way through the courts.

Roughly about 26 million people had already applied by the time a federal district court judge struck down the program in November 2022 which prompted the government to stop taking applications. Only two of the lawsuits against the program have made it to the Supreme Court.

The administration officially launched the application on October 17, 2022, following a brief “beta period” during which its teams assessed whether tweaks were needed. The White House has said that it has already approved 16 million applications for debt relief. The Department of Education will hold on to that information so it can quickly process those borrowers’ relief if the government prevails in court.

If the courts ultimately allow the program to move forward, it is not guaranteed that every student loan borrower is eligible for the debt relief. The restrictions and eligibility are as follow:

  • Only federally held student loans qualify
  • Private student loans are excluded
  • High-income borrowers are generally excluded from receiving debt forgiveness
  • Individual borrowers who make less than $125,000 a year and married couples or heads of households who make less than $250,000 annually could see up to $10,000 of their federal student loan debt forgiven.
  • If a qualifying borrower received a federal Pell grant while enrolled in college, the individual is eligible for up to $20,000 of debt forgiveness
  • Federal Direct Loans including subsidized loans, unsubsidized loans, parent PLUS and graduate PLUS are eligible
  • Eligibility is based on a borrower’s adjusted gross income for either tax year 2020 or 2021
  • Defaulted federal student loans would be eligible for debt relief under the program

It is currently unclear when, or if, borrowers will see debt relief under Bidren’s program.

Administration officials expected to be able to grant relief before January, when payments were set to resume after the pandemic-related pause expired. But now debt cancellation won’t occur until at least late June or early July when the Supreme Court is expected to issue a ruling.

Borrowers are expected to have until December 31st, 2023, to submit an application. Borrowers can apply online here:  https://studentaid.gov/debt-relief/application.


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