Most people are well aware by now that the current student loan situation in the United States is dire. College graduates are leaving school with an average of $30,000 in student loan debt, and the total outstanding student loan debt in the country has now reached a staggering $1.5 trillion.
Given these circumstances, it’s no wonder that many people are excited about President Biden’s recent executive order canceling up to $20,000 in student loan debt for eligible borrowers.
If you’re one of the millions of Americans struggling to repay your student loans, here’s what you need to know about this new student loan forgiveness policy and how you can take advantage of it.
First and foremost, it’s important to understand that this executive order does not automatically cancel anyone’s student loan debt. Instead, it instructs the Department of Education to develop a process for canceling student loan debt for eligible borrowers.
This means that, unfortunately, there is no guarantee that your student loan debt will be forgiven under this policy. However, it’s still worth exploring whether you might be eligible for student loan forgiveness and how to apply for it.
Checking For Student Loan Cancellation
To be eligible for student loan forgiveness under this executive order, you must first meet certain criteria.
The first thing you need to do is find out if your loans are owned by the federal government or a private lender. You can do this by logging into the National Student Loan Data System (NSLDS). If your loans are owned by the federal government, you may be eligible for modifications or even complete forgiveness under certain programs.
Here are the guidelines directly from the Federal Student Aid Website :
- To be eligible, your annual income must have fallen below $125,000 (for individuals) or $250,000 (for married couples or heads of households).
- If you received a Pell Grant in college and meet the income threshold, you will be eligible for up to $20,000 in debt relief.
- If you did not receive a Pell Grant in college and meet the income threshold, you will be eligible for up to $10,000 in debt relief.
So, if you’re hoping to have your student loan debt canceled under this new policy, be sure to stay tuned for more information from the Department of Education in the coming weeks and months.
In fact, they have announced that they will be releasing a form for borrowers. You can sign up for the form to be sent to your email on the department of education’s site.
If your loans are not owned by the federal government, then they are probably private loans.
Unfortunately, these loans are not currently eligible for any sort of mass discharge or forgiveness program.
However, you may still be able to get relief by suing your lender in court. A number of lawsuits have been successful in arguing that private lenders violated state laws when originating and servicing the loans. As a result, the courts have ordered the lenders to cancel the loans entirely.
There is hope on the horizon for students struggling with excessive student loan debt. If you have private loans, you may be able to get them canceled entirely by suing your lender in court. If you have federal loans, you may be eligible for modification or forgiveness programs. Either way, it’s important to act fast and find out what options are available to you so that you can get rid of your debt and move on with your life.
If you’re struggling to repay your student loans, don’t give up hope. There are options available to you that can help you get out of debt and move on with your life.
Be sure to explore all of your student loan cancellation options so that you can find the best solution for your situation. And if you need help, don’t hesitate to reach out to us.