GREENSBORO, N.C. — Thousands of dollars in student debt relief is coming to borrowers in the coming months, but not everyone qualifies and the amount you get differs depending on your situation. With so many questions surrounding the loan forgiveness plan, 2 Wants to Know student loan expert Betsey Mayotte from FreeStudentLoanAdvice.org answers the most common questions about the plan.
Who qualifies for debt cancellation, and how much can they get?
Mayotte says federal student loan borrowers qualify if they have an adjusted gross income under $125,000 for a single filer or $250,000 for a married couple or head of household. Those people can get $10,000 forgiven on their loans, and that amount goes up to $20,000 if they ever received a Pell Grant.
President Joe Biden's plan also extends the pause on student loan repayments through the end of 2022.
What is the process to make sure you get the forgiveness you qualify for?
Mayotte says the Department of Education has said about 8 million federal student loan borrowers aren't going to have to do anything to get their loan forgiveness. Another several million will have to apply, though. Mayotte says while we don't know what that exact process will be right now, the Department of Education has been working to ensure the process is as simple as possible.
You can sign up to receive an alert when the application is active, and find more information about your student loans, on StudentAid.gov.
Will people who have been paying off their loans get a refund?
If your loan was eligible for the COVID pause, Mayotte says you can receive a refund for any payments you made from March 13, 2020, through August 23, 2022. She says you just have to contact your loan service and say you'd like your COVID payments back.