Who Can Apply for Student Loan Forgiveness

The Department of Education launched a new program in October that provides federal student loan borrowers with relief. It’s called the Direct Loan Forgiveness Program. In March, Biden announced that up to $20,000 in forgiveness would be given to eligible borrowers.

The deadline for completing the application is December 31, 2023. You can complete the process in minutes.

Who can apply?

Only those who have federal student loans are eligible to receive forgiveness. They have to meet income requirements below $125,000 for individuals and $250,000 for households in 2020 and 2021. The requirements are computed based on your adjusted gross income, which is typically lower than your total income.

If you’re a recipient of a federal Pell grant, you can have up to $20,000 of your student loan erased. On the other hand, everyone else can get up to $10,000 in forgiveness. An estimated 43 million people can receive some relief through the program.

Those with federal student loans issued before June 30, 2022, are eligible for forgiveness. To apply, you must first go to the official website of the Department of Education. Studentaid.gov/debt-relief/application

You’ll need to provide your social security number, email address, and full name to apply online.

A paper application will be available if you cannot use the online method. You can also find an informative FAQ on the website.

How long?

After applying, it will take around four to six weeks to appear on your loan balance.

The federal student loan payments were temporarily suspended during the pandemic and will resume in January 2023. If you were still making payments during that period, ask your loan servicer for a refund. Then, apply for debt forgiveness.

The application deadline is December 31, 2023, but you can apply now and get your answer sooner rather than later. It’s better to know than wait, as the process or program may change in today’s climate.