These Two Types of Student Loans Are Not Eligible for Forgiveness, New Guidance Says

Biden’s new student loan forgiveness estimate


Biden’s new student loan forgiveness estimate

05:04

The Biden administration has changed its guidelines to eliminate some student loans from the right to waiver, a major turning point as the Department of Education makes final preparations to launch debt relief applications.

As of Thursday, borrowers with student loans through the Federal Family Education Loan (FFEL) program and Perkins Loans who have not yet consolidated their debt into direct loans will now no longer be able to do so and will no longer be eligible for federal debt relief. says the Ministry of Education now. Those programs, while federally guaranteed, are administered by private institutions. Borrowers with FFEL and Perkins Loans who applied before Thursday to consolidate into the direct loan program are still eligible for debt relief.

At this time, the Department of Education is “assessing whether there are alternative avenues to assist borrowers with federal student loans who do not hold ED, including FFEL program loans and Perkins loans, and is discussing this with private lenders,” the statement said. section on its website.

The department did not explain the reason for the change, which came on the same day six GOP-led states have sued the Biden administration about student debt. The Biden Administration cuts $10,000 in student debt for those earning less than $125,000 or households with incomes less than $250,000, while Pell Grant recipients, who come from less affluent families, may get an additional $10,000 waived.

The administration’s justification for the debt relief depends on a post-September. On September 11, 2001, the law that says allows the White House to act during a national emergency, in this case the COVID-19 pandemic. The plaintiffs in the GOP lawsuit cite a CBS News “60 Minutes” interview in which President Biden said the pandemic is “over”.

Borrowers can still apply for the debt relief, but the administration encourages them to apply before November 15 so that they can receive relief before January 1, 2023, when borrowers must resume payments on student loans. They have not had to make any payments since the start of the pandemic in 2020.

According to the White House, borrowers can still apply for debt relief until 2023.

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