Student Loan Payments
On August 24, 2022, President Biden announced that the federal government would cancel $10,000 in federal student loan debt for borrowers with individual income less than $250,000 for married couples or heads of household (or less than $125,000 for all other individuals), with an additional $10,000 ($20,000 total) in cancellation if those borrowers received a Pell Grant.
The new loan forgiveness program applies to federal loans owned by the U.S. Department of Education (not owned by a bank) that were disbursed before June of 2022, including Stafford loans, consolidation loans, Graduate Stafford and Plus loans, and Parent Plus loans.
In addition, the pause on student loan repayments has been extended one final time, to 12/31/2022.
Starting 1/1/2023, monthly student loan payments will be capped at 5% of discretionary income (income above 225% of the federal poverty level).
The U.S. Dept. of Education will be providing info on applying for loan forgiveness sometime in early October. To get an e-mail notification when the application for loan forgiveness is available, One Family program participants can visit ed.gov/subscriptions, and sign up for the "Federal Student Loan Borrower Updates" e-mail list.
For some individuals, loan forgiveness will be automatic, but to be on the safe side, those with loans eligible for forgiveness should apply online in October.
For additional info/details, visit the link below.