HomeFinance NewsPersonal financeHidden Catch: Biden's Student Loan Forgiveness - Are You Eligible?

Hidden Catch: Biden’s Student Loan Forgiveness – Are You Eligible?

  • ORIGINAL NEWS

You may need to take extra steps to qualify for Biden’s fast-tracked student loan forgiveness


  • SUMMARY

The Biden administration has announced an expedited plan to provide student loan forgiveness for eligible borrowers under its new repayment program.

The Saving on a Valuable Education, or SAVE, plan reduces monthly federal student loan payments for undergraduates from 10% to 5% of their discretionary income.

It also shortens the repayment period to 10 years for those who took out $12,000 or less in undergraduate or graduate studies.

To qualify for the early loan forgiveness, borrowers must be enrolled in the SAVE plan.

As of early January, about 6.9 million borrowers were enrolled.

If you are already enrolled in SAVE, you should see the forgiveness automatically.

If you are eligible but not yet enrolled, do so immediately at Studentaid.gov.

If you have a different type of federal loan, you may be able to consolidate it into a Direct loan, which is eligible for the SAVE plan.

Borrowers in default should utilize the Fresh Start program to become current on their loans before enrolling in SAVE.

The forgiveness process typically takes two to three months after a borrower’s enrollment in the SAVE plan has been confirmed.

If you have questions or do not receive the forgiveness you expected, contact the Federal Student Aid Information Center at 1-800-4-FED-AID.


  • NEWS SENTIMENT CHECK
  • Overall sentiment: positive
  • Positive



    “The Biden administration announced last week that it would fast-track its plan to deliver student loan forgiveness for certain borrowers in its new repayment plan.”

    “Borrowers were first able to enroll in SAVE, which the Biden administration has called “the most affordable repayment plan ever created,” last August.”

    Negative



    “However, some people may have questions about the news, which was not exactly straightforward.”

    “Meanwhile, “many are unaware of the opportunity,” said Elaine Rubin, director of corporate communications atĀ Edvisors.”

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