The Biden student loan forgiveness plan is here. How NC borrowers can get debt relief
After months of speculation, the Biden administration announced Wednesday its plan to wipe away thousands in student loan debt for millions of borrowers, but many eligible will need to take steps to get the forgiveness.
The plan, announced by President Joe Biden in a tweet, calls for debt relief for folks within a certain income threshold and additional forgiveness for borrowers who received a specific need-based grant. As such, some borrowers will need to prove that they meet the requirements in order to receive relief.
Here’s what North Carolina borrowers need to know about how to get student loan forgiveness and get a pause on their loan payments under the new Biden plan.
Biden student loan forgiveness plan
Under the plan announced Wednesday, folks with federal student loans who earn less than $125,000 a year, or families earning less than $250,000, would be eligible for up to $10,000 in loan forgiveness.
And borrowers who meet the income requirement and received a Pell Grant in college — a program that provides grants to undergraduate students with a financial need — can get an additional $10,000 in debt forgiveness.
How to get student loan forgiveness
Some borrowers — almost 8 million, according to the Department of Education’s Federal Student Aid division — “may be eligible to receive relief automatically because relevant income data is already available to the U.S. Department of Education.”
But if the education department doesn’t have your income information on file, or if you’re not sure if it does, Federal Student Aid advises that you’ll need to fill out an application in order to get the loan forgiveness.
The application will launch “in the coming weeks.”
Folks who will need to complete the application once it’s available can sign up at ed.gov/subscriptions to get a notification when it goes live.
How to get your student loan repayment pause extended
In addition to the new forgiveness program announced Wednesday, the Biden administration also said it will extend the pandemic-era pause on student loan payments one more time, through the end of the calendar year.
Borrowers with federal student loans don’t need to do anything to have their payment pause extended, per Federal Student Aid.
The pause on payments only applies to federal student loans, meaning those with outstanding private student loans still have to pay unless they’ve made arrangements with their loan servicer.
This story was originally published August 24, 2022 at 1:08 PM.
