Updated Apr 30, 2024 - Politics & Policy

Some student loan borrowers may need to apply for forgiveness by Tuesday

US President Joe Biden speaks about student loan debt relief at Madison Area Technical College in Madison, Wisconsin, April 8, 2024. (Photo by ANDREW CABALLERO-REYNOLDS / AFP) (Photo by ANDREW CABALLERO-REYNOLDS/AFP via Getty Images)

President Biden speaks about student loan debt relief in Madison, Wisconsin, April 8. Photo: Andrew Caballero-Reynolds/AFP via Getty Images

Some student loan borrowers may qualify for a one-time debt cancellation or credit, but they'll have to take action by Tuesday.

Why it matters: Eligible borrowers who consolidate their loans by the deadline may see thousand of dollars of student debt forgiven thanks to a one-time adjustment from the U.S. Department of Education this summer.

Zoom in: To get the most credit toward loan cancellation, borrowers with the following types of federally managed loans must consolidate them: commercially-held Federal Family Education Loan (FFEL), Parent PLUS loans, Perkins loans and Health Education Assistance Loan (HEAL) Program loans.

  • Payments a borrower has already made would be counted toward loan cancellation.
  • Those with a Parent PLUS loan that has been in repayment for at least 25 years and is managed by the Department of Education will have their loans canceled automatically, per the Education Department.
  • The Education Department expects the adjustment process to be completed by July 1.

Zoom out: The move is a part of the Biden administration's attempt to provide more student debt relief through fixes and workarounds after the Supreme Court blocked his large-scale forgiveness plan.

  • President Biden introduced another proposal this month aimed at providing student debt relief for millions of borrowers
  • The administration has so far doled out $153 billion in student debt relief to 4.3 million people through various actions. The new plan, if approved, would increase that aid to help more than 30 million borrowers.

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