After months of being bandied about, student loan holders can now apply for forgiveness. But how? We’ve got all the answers you need.
Tens of millions of Americans are eligible to have up to $20,000 of their federal student loans forgiven thanks to President Joe Biden’s new plan. Since the announcement, many student loan borrowers have been wondering if they are eligible, how to apply and when will the loan be forgiven? We sat down with Tony Aguilar, founder and CEO of student loan payment app Chipper, to get the low down on this new government program. From the how to the when, we’ve got all of your questions covered.
WHAT’S IN THE PLAN?
At last count the U.S. collectively owed more than $1.6 trillion in student loans. That outsized debt makes it difficult to put food on the table let alone buy a car or home, get married and even save for retirement. To help, the Biden Administration recently launched a one-time federal student loan debt relief program. Under this new initiative, borrowers who have a Federal Pell Grant can receive up to $20,000 in debt relief. For other federal loans, borrowers can get up to $10,000 of their loan forgiven. There are caveats. You have to earn less than $125,000 ($250,000 for married couples filing jointly) in either 2021 or 2022. And not every loan is covered. The student loans eligible for forgiveness include:
- William D. Ford Federal Direct Loan (Direct Loan) Program loans
- Federal Family Education Loan (FFEL) Program loans…
