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Student loan debt forgiveness: Your ultimate guide!

Within the next couple of weeks, the U.S. government will rid millions of Americans of their student loan debt. Find out more about what this means for you and how to apply.

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Find out how you can apply and get as much as $20,000 of student debt canceled.

student loan debt forgiveness
Biden’s student loan forgiveness is rolling out next month. Source: Adobe Stock.

Just within the next couple of weeks, everyone who’s eligible will be able to apply and get access to student loan debt forgiveness up to $20,000.

According to The White House, this new program will benefit over 40 million Americans. Plus, it’ll fully cancel student loan debt for approximately 20 million people. 

Additionally, if you made any payments on your student loans during the moratorium period, you can ask for a refund from your servicer as of now.

For people who are not eligible for the student loan debt forgiveness, or who still will owe a sum after part of their debt is canceled, all payments are on hold until January next year. 

According to the Department of Education, close to 8 million borrowers will have their student debt automatically forgiven.

That means they don’t need to take any action. However, most borrowers seeking debt forgiveness will need to apply for it. 

Are you unsure about your current status? Then keep reading to see if you’re eligible for the debt forgiveness plan. We’ll also tell you how you can apply for it. 

Student loan debt forgiveness eligibility requirements

The Department of Education will eliminate up to $10,000 in student loan debt for borrowers whose annual income is equal or lower than $125,000 under President Biden’s program.

Married borrowers or borrowers who are the heads of their households that make less than $250,000 annually will have the same amount of debt canceled.  

People who have received federal Pell Grants while in college may also be eligible for an additional $10,000 in debt relief. 

Borrowers will soon have access to an application

student loan debt forgiveness
You can apply for student loan forgiveness. Source: Adobe Stock.

The need to apply for student loan debt forgiveness depends on a key factor

Are you a part of the group of borrowers who are enrolled in income-driven repayment plans and the Department of Education has your current income information?

Then it will automatically cancel your eligible debt. Therefore, there’s no need for any further action. 

However, if the department doesn’t have access to your current income information, you’ll need to fill out a new application from the Biden administration.

That application should supply all the data the department needs to process your student loan debt forgiveness. 

In a late August press briefing, the National Economic Council Deputy Director said that the application for the student loan debt forgiveness will roll out in October.

He mentioned that once borrowers complete and submit their application, they can expect debt relief within four to six weeks. 

What is a student loan, and how does it work?

It’s easy to understand why student loan debt forgiveness is so important to many. But first you need to understand how student loans work.

Follow the link below to get a better grasp on the subject. Either out of curiosity or if you’re after a student loan yourself!

student loan

What is a student loan, and how does it work?

Student loans can be a little confusing to understand at first. But once you know the basics, they're not so bad!

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