Thanks to President Biden, a new waiver will be created for when the Department of Education changes what counts toward income driven repayment plans.
The change is expected to happen in November of 2022.
This news comes as people across the country work to see if they will receive the student loan forgiveness worth up to $20,000 for some.
What is income driven repayment forgiveness and when will it happen?
According to My Twin Tiers, the plan will start in November for borrowers that have been paying on their federal student loans for the last 20 years or longer.
These people can expect to see the rest of the debt they have forgiven.
What income driven plans do is they give reduced payments for 20-25 years and then forgive the remaining balance.
This system was created in the 90s to stop those who owed student loan debt from struggling financially.
The payments are based on what the person earns instead of what they owe.
Now, the changes will impact which payments will count.
Every month you have made a payment since leaving school will count toward loan forgiveness.
Those who have made at least 240 payments can expect to see their loan debt entirely eliminated.
Others will see themselves closer to having the debt paid off.
The forgiveness will be automatic for most, but some may have to do something to trigger it.
First, anyone with FFELP loans will need to consolidate their debt to have direct loans. The deadline for commercially held loans is May 1, 2023. Having it done by Oct. 31 is more ideal.
Anyone looking for Public Service Loan Forgiveness needs to apply for it.
Some people might need to enroll in an income driven repayment plan.
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