For many borrowers in UNITED STATES who owes money to student loansthere will be a huge amount of relief coming this year, which could be a big financial plus.
For those who qualify, up to $20,000 could be wiped from the account in the name of student loan forgiveness.
In addition to this possible cancellation, for those who repaid during the moratorium on student loan repayments that came into effect during the COVID-19 pandemic, a refund may be requested from the loan servicer.
If you are not eligible for student loan forgivenessor if you still owe money after the debt is forgiven, even then you won’t have to make a payment until January 2023.
How to cancel student loan debt?
There are some people whose student loan debt will automatically be forgiven without the need to take action, but the majority will have to apply for it. Determining if you are eligible for this plan is the first step.
Below President Joe BidenIn the Department of Education’s plan, the Department of Education will forgive up to $10,000 in federal student loan debt for individual borrowers who earn less than $125,000 a year or less than $250,000 for married borrowers or those who are heads of households.
You may also be eligible for additional relief of $10,000 if you received federal Pell grants while attending college.
If the Department of Education does not have information about your income, it will automatically cancel your debt and no application will need to be made.
For those who have already provided the information, you must complete a new request with the Biden the administration to provide the information the service needs to cancel your debt.
At a press briefing on August 26, the deputy director of the National Economic Council Bharat Ramamurti said the student debt cancellation application will go live in early October.
He also said that once borrowers complete their applications, they can expect relief “within four to six weeks.”
“Borrowers are advised to apply before around November 15, in order to qualify for relief before the payment break expires on December 31,” Ramamurti said.