[Update] –
A Texas federal judge struck down the Biden Administrations Student Loan forgiveness program on November 10th 2022. However, the Biden Administration is appealing the ruling. Representatives from the white house have announced that the education department will retain the information of the 26 million borrowers (half of the eligible 40 million borrowers) who have already applied. However, the education department is not accepting applications after the ruling of the appeal trial. You can sign up for updates at studentaid.gov.
______________________________________________________________________________________________________________________________
President Biden has announced his new Federal Student Loan debt relief program. The program provided eligible borrowers with full or partial discharge of loans. This plan would provide borrowers with up to 20,000 in debt cancellation to pell grant recipients and up to 10,000 to non-pell grant recipients.
This program has been estimated to help 9 million borrowers. To determine if you are eligible for the program you must meet the following criteria. You must be a current federal student loan holder. You must earn less than 125,000 a year or your household earns less than 250,000 a year. If you meet the eligibility criteria you can apply any time before today (Oct. 31. 2022) and dec. 31, 2023. Qualifying borrowers are being advised to apply before Nov. 15, 2022 in order to receive relief before the payment pause before the payment pause expires on Dec. 31, 2022. In order to apply and for additional details regarding eligibility please visit Debt Relief | Application | Federal Student Aid and FACT SHEET: President Biden Announces Student Loan Relief for Borrowers Who Need It Most – The White House.
President Biden acknowledges the correlation between a post high school education and a middle class life with higher health outcomes, educational attainment, quality of life, and generational wealth attainment. Since 1980 the cost of a four year college education has tripled, while wages have been stagnant and cost of living has increased. Pell grant used to provide about 80% of the cost of attendance for four year universities, now they only cover about ⅓. This has left millions of students with the only choice but to borrow in order to obtain their degree. The department of education has determined that the typical undergraduate student graduates 25,000 dollars in debt.
Middle class student loan recipients with this debt are burdened with high monthly payments and balances that make it hard for them to invest in their retirement, buy homes, start businesses and invest in their children. Not to mention the borrower without completed degrees, who still have debt. This demographic of people make up about ⅓ of borrowers. Senior citizens are not exempt from this population of student debt holders, ⅓ of senior citizens with debt are in default, which causes the government to garnish their wages, and lower their credit score.
This new federal student loan debt relief program, is estimated to provide relief to up to 9 million people that can raise credit scores, increase better health outcomes, provide higher educational attainment, allow people to buy homes, increase income, and invest in their retirement. Make sure you apply today in order to receive your share.