How To Qualify , for Biden's , New Student Loan Forgiveness Plan.
President Joe Biden announced the new plan for student loan forgiveness on Aug.
24.
Biden also announced an extension to the student loan payment pause initiated during the Trump administration.
Here are answers to some common questions regarding the student loan forgiveness plan.
1, Do I qualify?.
If you are a federal student loan borrower, you potentially qualify for debt forgiveness.
Single borrowers with an annual income of less than $125,000 a year (or married and head of household borrowers making less than $250,000) qualify.
2, How much debt forgiveness is included in the plan?.
If you meet the requirements, the plan allocates $10,000 in debt forgiveness.
Qualifying borrowers who also received a Pell Grant will receive an additional $10,000 in forgiveness for a total of $20,000.
3, What steps do I need to take?.
If the Department of Education currently has your income information, you are instantly considered for the forgiveness.
Other borrowers will need to apply through an application process to be launched in the coming weeks.
4, Does the plan include any changes to future repayments?.
The new income-driven repayment plan reduces the percentage monthly income cap from 10 percent to five percent.
In addition, those who earn 225 percent or less of the federal poverty level will not make a monthly payment.
Also, borrowers with up to $12,000 in debt will have their debt forgiven after 10 years instead of 20 years
