What to know about President Biden’s recent announcement on student loan forgiveness

(Image source: twitter.com/POTUS)

As many of you know, President Biden announced earlier today his intentions to forgive up to $20,000 in federal student loan debt for Americans under a certain income threshold, as well as extend the COVID-19 pandemic-related payment freeze for federal loan borrowers through 2022.

We understand that you likely have questions about whether you qualify for this forgiveness, so we’ve assembled the below information to help you better understand what this historic announcement means for you.

What did President Biden say about student loan forgiveness?

On August 24, 2022 President Biden announced that he intends to implement action allowing individual borrowers who earn less than $125,000 annually, or families earning less than $250,000 annually to receive $10,000 in federal student loan forgiveness.  He also announced that the current freeze on federal student loan payments would be extended four additional months, ending in January 2023.

Additionally, President Biden announced that those who have received Pell Grants in the past would be eligible for an additional $10,000 in federal loan forgiveness, bringing the total student loan forgiveness amount that these individuals are eligible for to $20,000.

How do I know if I am eligible for loan forgiveness?

If you are an American who currently has a student loan balance, and whose earnings fall within the above income guidelines, then you are likely eligible for the initial $10,000 forgiveness. Pell Grant recipients, those undergraduates who have the most significant financial need, may be eligible for the additional $10,000 forgiveness.

There are two ways to check into whether or not you are a Pell Grant recipient:

  1. – Use your FSA ID to log into your Free Application for Federal Student Aid (FAFSA) account.

You will need the username and password that you created when you first processed your FAFSA form in order to access this account.  Once inside your dashboard, you will select “view Student Aid Report (SAR)” on your homepage.  This report will show you which financial aid awards you have received in the past, and which others you are eligible for.

  1. – Visit the National Student Loan Database website.

What other opportunities are there for student loan forgiveness that I should know about?

From now until October 31, 2022, public service employees of qualifying organizations are eligible to apply for the Limited PSLF Waiver and may be able to have student loan debts forgiven. In order to qualify, employees must have a Direct Loan(s), and be working for a government or nonprofit agency for at least ten years while making payments on your loans.

If you think your employment may qualify, you are encouraged to apply, even if you have not made 120 student loan payments or been employed with a qualifying agency for ten years. Check your employer’s eligibility by using the PSLF Help Tool .

For the full fact sheet on President Biden’s announcement regarding student loan debt relief, see the statement released from the White House here.

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