Want to forgive your student loan? Here is a roadmap

Student loan cancellation continues to dominate the news in 2022. The Biden administration has so far refused to implement a blanket student debt cancellation. Instead, the administration opted for a “targeted” student loan forgiveness, improving and expanding several existing programs.

Here’s where current student loan relief programs stand and how to start the process for applying for relief.

Student loan waiver for public service borrowers

The Public Service Loan Forgiveness (PSLF) program offers a federal student loan discount to borrowers who have dedicated their careers to working for nonprofit or public organizations. Under the program’s original rules, the PSLF had strict eligibility criteria, limiting relief to borrowers with direct federal student loans as repayment under income-based repayment plans.

But as part of the new Limited PSLF Waiver program announced in October, the Biden administration is relaxing key program requirements and expanding the types of eligible loans and payments. For a limited time, payments made on Federal FFEL Program Loans and Federal Perkins Loans may count toward the PSLF. And payments made under any repayment plan, including payments made before the direct loan consolidation, may also be eligible. Borrowers may need to take action before October 31, 2022 by consolidating non-direct federal student loans into a direct consolidation loan and certifying past and present public service jobs. Learn more about the limited PSLF waiver program here.

Other federal profession-based student loan exemption programs continue to exist, although they remain unchanged. Check out the Teacher Loan forgiveness program and the Perkins loan forgiveness program, both of which are separate from the PSLF.

Student loan waiver for borrowers with disabilities

The Total and Permanent Disability Release (TPD) program cancels federal student loan debt for borrowers who are unable to maintain substantial, gainful employment due to a health problem.

Under recent changes announced by the Biden administration, borrowers who receive Social Security disability benefits can have their loans automatically canceled as part of the TPD discharge program. In addition, the administration indefinitely suspended post-discharge revenue monitoring, which was required under federal rules for three years after the approval of a TPD discharge. Earning too much money from employment, or not responding to the income survey, has resulted in discharge reversals for thousands of borrowers. The Ministry of Education is also in the process of amending the TPD discharge regulations to permanently remove income controls.

Borrowers who are disabled but are not receiving Social Security disability benefits may still be eligible if they have a certification from the Veterans Administration that they are completely disabled due to a military service-related injury, or if their doctor certifies that they meet the PDT standard. Lean more here.

Student loan waiver for borrowers defrauded by their school

The Borrower Against Repayment program can write off federal student loan debt for borrowers who have been defrauded by their school because of false statements or promises. The Biden administration recently relaxed previous rules that allowed the Education Department to grant little or no relief, even for approved applications. Yet the program remains troubled and mired in bureaucratic and legal disputes as the ministry seeks to revise regulations governing the borrower advocacy program. In the meantime, borrowers can read more about borrower advocacy here.

There are other federal student loan release programs available to borrowers aggrieved by their school. The Closed School Discharge program may allow borrowers to cancel their federal student loans if they were unable to complete their diploma or certificate program due to their school closure. The False Certification Clearance Program may also provide for the cancellation of a student loan in limited circumstances where a school official has falsely certified a borrower’s qualifying status or ability to benefit from their educational program.

Will Biden adopt blanket student loan cancellation?

Over the past 12 months, student loan borrower activists, rights groups and congressional progressives have urged President Biden to use executive action to write off more than $ 50,000 in debt. student loan for every borrower. Legal experts allied with these groups have argued that federal law gives the president broad legislative power to unilaterally write off federal student loan debt. But other legal experts disagreed with this conclusion.

Biden campaigned to forgive borrowers of $ 10,000 in federal student loan debt, but he has since expressed skepticism about his legal authority to act without direct congressional authorization, and he has categorically opposed the $ 50,000. student loan forgiveness. Meanwhile, the Department of Education and the Department of Justice have reportedly produced official memos describing Biden’s potential legal authority (or lack thereof), but full details of those memos have not yet been released. made public. The administration has not officially closed the door on a large-scale student debt cancellation, but a decision does not appear to be imminent at this time either.

How to proceed?

The above student loan exemption programs are limited to federal student loans only. And many of these programs have additional strict eligibility criteria. To get started, you can view your federal student loan records through the Department of Education’s web portal at StudentAid.gov. You can also view the ministry’s information on student loan waiver programs and associated application procedures here.

Further reading on student loans

Student Loan Cancellation Updates: New Changes Coming in 2022 for Public Service Borrowers

3 big takeaways from Biden’s surprise extension of student loan relief

$ 2.4 billion in student loan forgiveness for 38,000 borrowers in preparation, education ministry says

First wave of borrowers secures $ 715 million in student loan cancellations as part of new program expansion

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