Biden decided to forgive the student debts of 100 Americans

The Department of Education said 100 borrowers are eligible for student debt forgiveness due to changes the department has made to the loan forgiveness program. Writes about it CNN.

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It is expected that the amount of forgiven debts will be about $6,2 billion. So far, not all eligible borrowers have been notified of the debt cancellation. They are notified on a regular basis. The Department of Education cannot provide an exact date when everyone will be contacted.

This is one of the most extreme attempts by the Joe Biden administration to make it easier for some borrowers to qualify for loan forgiveness under existing programs.

The Student Loan Forgiveness Program (PSLF) promises to pay off remaining federal student loan debt after the eligible debtor makes monthly payments for 10 years. It was created about 15 years ago, but a very small percentage of applicants received forgiveness before 2021.

Many borrowers have criticized the program as complicated, and some only learned they were not eligible for loan forgiveness after they made what they thought were the appropriate payments for a decade. Only borrowers with certain types of federal loans and enrolled in certain programs were eligible for loan forgiveness.

Last year, the administration of U.S. President Joe Biden temporarily expanded eligibility until October 31, 2022, so that the program now includes borrowers who had loans that did not qualify initially.

On the subject: Money paid on student loans will be returned to thousands of people in the USA

“The PSLF announcement means that many more of our dedicated teachers, nurses, lifeguards, military personnel and many other public employees will receive significant relief,” said Miguel Cardona, head of the Department of Education.

Who qualifies for loan forgiveness

It no longer matters what federal student loan the borrower has or what repayment plan they have.

Previously, eligibility for credit was conditional on having direct credit and participating in an income-based repayment plan that sets payments based on income and family size.

What Borrowers Can Do Now

Many borrowers do not need to take any action to have the Department of Education verify and update their payment amounts.

But those with older federal loans will need to combine them into direct loans if they haven't already.

Those who already have direct loans but have not submitted proof of employment forms for past repayment periods should do so now.

Borrowers must make these changes by October 31, 2022 to be eligible for temporary waiver forgiveness.

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Student loan repayments to resume in May

Federal student loan borrowers have not been required to make monthly payments since March 2020 due to a payment suspension related to the COVID-19 pandemic. After several extensions to the pause, the Biden administration announced late last year that payments would resume on May 1.

But due to inflation, some borrowers have begun to worry about the possibility of resuming payments, and a Russian invasion of Ukraine could lead to even higher prices.

Last week, White House Chief of Staff Ron Klein said the Biden administration was considering another extension of the pause.

“I think the president will decide what we should do with student debt before the pause expires, or he will extend it,” suggested Klein.

Biden has campaigned for a sweeping write-off of $10 of student debt per borrower, but has so far resisted pressure to do so. Instead, the Biden administration is making changes to already existing forgiveness programs, such as loan forgiveness and the for-profit college defrauded borrower relief program, so that more people qualify for forgiveness. To date, more than $000 billion in student debt has been written off under Biden.

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