Tens of thousands of borrowers with federal student loans are probably wondering: Is my debt load a little lighter?

The Biden administration announced Friday that more than 800,000 borrowers would have their remaining loan balances written off as part of a program to address past mistakes made by loan servicers who didn’t give payday credit where it was due — or who may have given bad advice when borrowers called for help.

In the coming days and months, thousands of borrowers will learn whether they received an account adjustment resulting in enough qualifying payments to eliminate their loans — a process that will continue until the end of the year. After that, borrowers who still don’t have enough qualifying payments for cancellation will receive their updated payment calculations.

Here’s what we know about who’s eligible:

Borrowers with direct loans or those made through the Federal Family Education Loan, or FFEL, program and held by the Department of Education may qualify, including borrowers with Parent PLUS loans.

But borrowers are eligible for debt cancellation only if they’ve reached the qualifying number of payments — that’s the equivalent of either 20 or 25 years of qualifying monthly payments, or 240 or 300 payments on income-driven repayment (where payments vary based on). depending on the borrower’s income and family size) or standard repayment.

The exact number of qualifying payments varies depending on the borrower’s loan type and the payment plan in which the person is enrolled.

Borrowers’ updated payment count will include any month they were in repayment – regardless of the type of loan, the repayment method used, or whether payments were partial or late.

But they will also get credit for anyone period they have spent 12 or more consecutive months in tolerance, as well as any month in forbearance for those who have spent 36 or more cumulative months in forbearance.

Every month spent in delay – other than in-school delay – before 2013 will also count. The same applies to any month spent in economic hardship or military delay on or after January 1, 2013.

The outlined situations will also count if they occurred before you consolidated your loans.


The Education Department said it will notify borrowers if they have enough payments for cancellation without further action on their part — and they will continue to notify borrowers who have reached the debt elimination threshold every two months until next year.

Debt discharges will begin 30 days after emails are sent – and the borrower’s loan servicer will notify them when it is complete.

If you make payments – which will resume sometime in October after a three-year payment freeze – those will be paused until the debt is cleared.

(Borrowers who want to cancel for any reason must notify their loan servicer.)

You probably won’t be able to collect this information for a while — and probably not until next year. The loan servicers are still waiting for the Department of Education to update those numbers, so calling your servicer probably won’t yield any new information.

The Education Department said that once they have processed all borrowers eligible for debt cancellation, they will update the payment calculations of other borrowers.

Any months counted can also be applied to Public Service Loan Forgiveness – as long as you can document that you worked for a qualifying employer during the same period.

By admin

Leave a Reply

Your email address will not be published. Required fields are marked *