What’s Being Forgiven:
The forgiveness applies to all Federally-held Direct, Perkins, and FFELP loans, even if they’re currently in default.
Pell Grant recipients are eligible for up to $20,000 in student debt cancellation if they earn less than $125,000 ($250,000 household) in 2020 or 2021. Non-Pell Grant recipients can receive up to $10,000 in student debt cancellation with the same income.
There is still time to enroll in an income-driven repayment plan and make extra payments toward your principal balance.
Borrowers at all stages of repayment should qualify. It doesn’t matter if you’re still in school, in repayment, or in grace as longa s you meet the income requirements.
How to Apply:
Online applications are expected to come in early October. Borrowers will have until Dec. 31, 2023, to apply. It’s possible that borrowers who have already shared their income information by automatically qualify for forgiveness, by that information hasn’t been confirmed.
Refunds on Payments Made During the Forbearance:
If you were making payments in the last two years during the pause and you would like that money back so it can be forgiven, you can request a refund by calling your servicer.
Most refunds take between six to twelve weeks and you have all of 2023 to apply for forgiveness. It’s okay to wait until more details come out.
It’s possible the Education Department will include refunds in the application due out in October.
Contact your IonTuition concierge advisor today if you have questions. And be on the lookout for more information in the coming weeks.