HomePoliticsThese two types of student loans are not eligible for forgiveness, says...

These two types of student loans are not eligible for forgiveness, says new guidance

The Biden administration has changed its address to remove some student loans from forgiveness eligibility, a major change as the Department of Education makes final preparations to launch debt relief applications.

Beginning Thursday, borrowers with student loans through the Federal Family Education Loan (FFEL) and Perkins Loans program who have not yet consolidated their debt into direct loans will no longer be able to do so and will no longer be eligible for federal debt relief. . says now the Department of Education. These programs, although guaranteed by the federal government, are run by private institutions. Borrowers with FFEL and Perkins Loans who applied for consolidation in the direct loan program before Thursday are still eligible for debt relief.

At this point, the Department of Education “is evaluating whether there are alternative avenues to provide relief to borrowers with federal student loans not held by ED, including FFEL Program loans and Perkins Loans, and is discussing this with private lenders,” the department says on its website

The department has not explained the reason for the change, which occurred the same day six GOP-led states sued the Biden administration on student debt relief. The Biden Administration is paying off $10,000 in student debt for those earning less than $125,000 or households with less than $250,000 in income, while Pell Grant recipients, who come from less wealthy families, may have an additional $10,000 forgiven.

The administration’s rationale for debt relief hinges on a post-September. The November 11, 2001 law that the White House says allows it to act during a time of national emergency, which in this case was the COVID-19 pandemic. Plaintiffs in GOP lawsuit cite CBS news Interview “60 Minutes” in which President Biden said the pandemic is “over.”

Borrowers can still apply for debt relief, but the administration encourages them to do so before November 15, so they can get the relief before January 1, 2023, when borrowers must resume student loan payments. They have not had to make a payment since the start of the pandemic in 2020.

According to the White House, borrowers will still be able to apply for debt relief until 2023.

Source link

- Advertisment -

Most Popular