Anyone who is planning to go to college or is currently enrolled would agree that the fees they pay are off the charts. Tuition itself is not the only thing to worry about; rent, food, clothes, phone subscriptions, travel, and a whole lot of other expenses need to be accounted for by students. Student debt is ca serious problem. To help parents and students who are struggling with debt, the U.S. President Joe Biden introduced the Student Loan Forgiveness Plan.
With that being said, is everyone qualified to avail of this plan? If not, what are the requirements for someone to be qualified for it?
What is the Student Loan Forgiveness Plan?
This loan is a three-part program that aims to lessen the burden of college costs. Today, around $2.6 trillion of debt is owed by 45 million borrowers who mostly belong to America’s middle class sector. By dividing the plan into three parts, it would give leeway for American families to pay for their debt.
Working families who are also recovering from the financial burden of the pandemic are given more time by this loan.
Further, previous loans that were charged monthly will now be halved for undergraduate students. This repayment plan will enable low-income borrowers to pay for loans in a way that is less burdensome for them.
Who qualifies for this loan?
Not everyone is qualified for Biden’s student loan forgiveness plan. Federal student loan borrowers must meet certain criteria in order to participate in the program.
- The individual must have a current outstanding debt on federal student loans and also parent PLUS loans that have been obtained before the 30th of July, 2022.
- If the individual’s loan is held by the Department of Education and they earn less than $125,000, whether it would be individually or as a family.
- Married couples and/or head of households must make less than $250,000.
- For students that are dependent on their parents or legal guardians, they must provide information regarding their income. This would be checked for eligibility.
- Those who belong to either undergraduate, graduate, and/or professionals degrees may be qualified for student loan forgiveness.
- For those who have not finished their degrees, they may still be eligible to participate.
- Those who have defaulted their federal student loans are still eligible to apply.
Take note that the $10,000 amount forgiven is available to students whose loans are held by the Department of Education and if they earn less than $125,000 as an individual or as a family.
On the other hand, the $20,000 amount forgiven is eligible for those who have received Pell Grants. Pell Grants are given to students who belong to the low-income class.
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