The Biden administration has changed its guidance to eliminate some student loans from being forgiven, a major reversal by the Education Department as final preparations to launch debt relief applications.
As of Thursday, borrowers with student loans through the Federal Family Education Loan (FFEL) program and Perkins Loans who haven’t already consolidated their loans into direct loans will no longer be able to do so and will no longer be eligible for federal debt relief. are not eligible, now the education department says. Those events, although federally guaranteed, are organized by private institutions. Borrowers with FFEL and Perkins loans who applied to consolidate into the Direct Loan program before Thursday are still eligible for debt relief.
At this point, the Department of Education is “assessing whether there are alternative avenues to provide relief to borrowers with federal student loans held by ED, including FFEL program loans and Perkins loans, and is discussing this with private lenders.” has been,” says the department. its website.
The department did not specify the reason for the change, which came on the same day.on student loan relief. Biden Administration An additional $10,000 may be waived for those earning less than $125,000 or for families earning less than $250,000, while Pell Grant recipients who come from less affluent families.
The administration’s rationale for debt relief rests after September 1. 11, 2001, legislation that allows the White House to act in times of what the White House says was a time of national emergency, which in this case was the COVID-19 pandemic. Plaintiffs in GOP lawsuit cite a CBS NewsIn which President Biden said the pandemic is “over.”
Borrowers can still apply for debt relief, but the administration is encouraging them to apply by November 15, so they can get relief no earlier than January 1, 2023, when borrowers need to resume student loan payments. would be required. They have not had to pay since the start of the pandemic in 2020.
According to the White House, borrowers will still be able to apply for debt relief in 2023.