Diego Lopez, Reporter
Current and former college students should mark November 15 on their calendars. President Joe Biden and the United States Department of Education has announced a plan to erase the student debt of millions of Americans.
No time has been set for when applications will be available for the public to fill out but the education department has declared that applications will come out in early October. Loan borrowers will have until November 15 to submit their applications.
How Much Debt Will be Erased?
COVID-19 created serious economic hardship for Americans, President Biden and the Department of Education are going to erase $10,000 of debt for every student with current loans, with some students receiving $20,000 in cut debt. The loan erasure will only effect debt held by the federal g o v e r n ment, not debt held by private institutions.
Students who received Pell Grants will be eligible for $20,000 in debt erasure. Students who did not receive Pell Grants, just standard education loans, are eligible for $10,000 in debt erasure.
When application are released, there will not be much time to complete them before the deadline of November 15 comes to turn them in. To ensure a “smooth transition”, as the Department of Education calls it, the Biden Administration has extended a repayment pause to December 31. Since taking offices, President Biden has paused repayment of student loans from borrowers, the extension to Dec. 31 will be the final extension. The pause will happen automatically, borrowers do not need to act to receive the extension.
Who Is Eligible?
The Department of Education already has the financial status of thousands of borrowers, but because they will not let those students know, it is important that every borrower fills out an application to receive the student loan forgiveness.
Borrowers are eligible for debt relief if: As a single tax-filer, annual income is $125,000 or less.
As a tax-filing couple, annual income is $250,000 or less.
Borrowers who are employed by non-profits, the US military, federal, state, Tribal, or local governments may be eligible to have their entire student debt erased through the Public Service Loan Forgiveness Program. This program usually offers minimal debt forgiveness for borrowers, but recent time-limited changes to the structure of the program may offer 100 percent loan forgiveness. Visit PSLF.gov for more information. If a student has debt that is less than the forgiveness, only the remainder of the debt will be forgiven, this is because relief is capped at $10 or $20,000, or the remainder of the debt. To be alerted when student loan forgiveness application become available, visit www.ED.gov/subscriptions and select “NEW!! Federal Student Loan Borrower Updates”, you must check the box which says “By checking this box, you consent to our data privacy policy” and then click next.