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  • The Biden administration plans to forgive $10,000 in student debt for many borrowers.
  • Some borrowers will have their debt canceled automatically, while others will have to apply for it.
  • You may also be eligible for a time-limited Civil Service loan waiver.

President Joe Biden’s student loan forgiveness plan will provide financial relief to millions of borrowers by writing off their debt entirely or leaving them with lower monthly payments.

You qualify for student debt relief if your annual federal income is less than $125,000 for an individual or $250,000 if you are married, jointly filing, or are the head of a family. The lowest tax year between 2020 and 2021 is the year the government will consider when determining if you qualify for the rebate.

The Department of Education will forgive $10,000 in loans for all federal borrowers and up to $20,000 for Pell Grant recipients. If this doesn’t completely clear what you owe, it will reduce your balance and the amount of money you owe each month.

Here’s how to make sure you get all the pardons you’re entitled to.

Sign up to be notified when applications are posted online

Most borrowers will need to apply for forgiveness, although around 8 million will have their debt canceled automatically.

To obtain cancellation, you will need to submit an online request to the Ministry of Education. The application should be ready at the beginning of October. Sign up for DOE email alerts to be notified when the application goes live by visiting ed.gov/subscriptions for the latest updates.

Once your application is filed, your debt should be canceled within four to six weeks.

Don’t wait to apply. Apply before November 15 to ensure your relief comes before the repayment pause expires at the end of December. You have until December 31, 2023 to submit your application.

Also, be sure to update your personal information with your loan officers so you don’t have any issues receiving a discount.

See if the Civil Service Loan Forgiveness Exemption applies to you

There is a time-limited waiver for the Civil Service Loan Forgiveness Program through October 2022 that temporarily changes its rules and makes it easier for borrowers to qualify for the forgiveness.

The Public Service Loan Forgiveness, or PSLF, completely forgives the debts of graduates employed in the public sector after at least 10 years of service and qualifying payments. Your particular job is not important, only that you work for a public service employer. There is no limit to the amount of money that can be forgiven.

Here are the basic requirements to qualify:

  • Be an employee of the U.S. federal, state, local, or tribal government, or qualifying nonprofit organization – this includes military service
  • Work full-time for this employer
  • Make 120 qualifying payments

You will not be eligible for the program if you work for a union, partisan political organization or for-profit business – which includes government contractors.

Here’s what you need to know about the waiver:

All repayment plans now count for PSLF

Until October 31, 2022, borrowers can receive credit for past payments that would not normally qualify for the PSLF. All you need is qualifying employment – regardless of repayment plan or whether payment was made in full or on time.

Parent PLUS loans are not eligible for PSLF, even with this waiver, although Grad PLUS loans are eligible.

Previously, you had to repay your loans under an income-driven repayment plan to qualify for PSLF, but now previous payments under any plan count.

Direct Loans and Direct Consolidation Loans count towards the PSLF

If you have direct loans or direct consolidation loans, the government changes will apply to you. If you consolidate previously ineligible loans – such as the Perkins loan or FFEL loans – into direct consolidation loans by October 31, 2022, these changes will also apply.

FFEL and Perkins loans are still not eligible for the repayment break. You will need to consolidate all non-direct loans to eventually become eligible for non-payments counted for the PSLF – although this is not guaranteed.

Go to studentaid.gov/pslf to have your payments considered for waiver.

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