Biden Loan Forgiveness Application: Everything You Need to Know

The Biden loan forgiveness application is a game-changer for many Americans struggling with student loan debt.

To be eligible, you must have earned less than $125,000 in 2020 or 2021, and have a Pell Grant in your name.

The application process will be open for a limited time, so it's essential to act quickly.

You can expect to receive your forgiveness within 4-6 weeks after submitting your application.

To be eligible for student loan debt relief, your annual federal income must have been below $125,000 (individual) or $250,000 (married, filing jointly or head of household) in 2020 or 2021.

Borrowers who earned less than $125,000 in either 2020 or 2021 and married couples or heads of households who made less than $250,000 annually in those years are eligible for up to $10,000 in federal student loan debt forgiveness.

To qualify, you must have received a federal Pell Grant while enrolled in college, and your income must meet the requirements, making you eligible for up to $20,000 in debt forgiveness.

New loans disbursed on or after July 1, 2022, do not qualify for debt relief.

Public service workers with at least 10 years of service may also be eligible to have their student loan debt canceled.

If you work full-time for a nonprofit or a government agency, you might be eligible for a special forgiveness program. This program is called PSLF, which stands for Public Service Loan Forgiveness.

People who work in these types of jobs can have their federal student debt erased after making 120 monthly payments over 10 years. This program also covers some teachers, doctors, nurses, firefighters, social workers, and members of the U.S. Armed Forces, among others.

The PSLF program has been around since 2007, but it was in a bit of a mess until the Biden administration made some changes. These changes have helped more people get the relief they need.

So far, over 871,000 borrowers have been granted $62.5 billion in relief under PSLF since October 2021. Before that, only 7,000 borrowers had ever received forgiveness.

To enroll in PSLF, you need to tell your current loan servicers that you plan to apply for the program. You can do this by phone or through the government's PSLF Help Tool.

To be eligible for student loan debt relief, you must have had an annual federal income below $125,000 as an individual or $250,000 as a married couple or head of household in 2020 or 2021.

You can receive up to $10,000 in federal student loan debt forgiveness if you meet the income requirements, regardless of whether you received a federal Pell Grant.

Federal Pell Grant recipients who meet the income requirements are eligible for up to $20,000 in student debt forgiveness.

Public service workers with at least 10 years of service may also be eligible to have their student loan debt canceled.

New loans disbursed on or after July 1, 2022, do not qualify for debt relief.

The U.S. Department of Education will review your application and determine your eligibility once you submit it.

Borrowers who do not have their income currently on file with the DOE will have to apply through an online form, which is expected to be available by early October.

If you fail to complete the application before the payment pause expires on December 31, you will still be able to get the relief.

If you're eligible for debt relief, you should periodically check your emails for updates from your student loan servicers and Federal Student Aid.

Borrowers who don't have their income currently on file with the DOE will have to apply through an online form, expected to be available by early October.

To receive relief before the latest payment pause extension ends on December 31, complete the application before November 15. Borrowers who fail to complete the application before the payment pause expires at year-end will still be able to get the relief.

To apply for student loan forgiveness, periodically check your emails for updates from your student loan servicer and Federal Student Aid.

Eligible borrowers can apply on the Federal Student Aid website for other kinds of relief, such as disability, nonprofit, teaching, government, or medical professional forgiveness.

Borrowers repaying their loans for 20 to 25 years can apply for income-driven repayment (IDR) loan forgiveness.

Check the Federal Student Aid website for other loan forgiveness options, but be sure to look closely at each selection to see if you're eligible.

Victims of forgery, borrowers who declared bankruptcy, and Perkins loan borrowers are examples of individuals eligible for forgiveness.

Relief is automatic for 8 million borrowers whose income is already on file at the Department of Education.

These borrowers will have their loans automatically forgiven without having to apply, which is a big relief for many.

The online application form for borrowers who don't have their income on file will be available by early October, and they should complete it before November 15 to receive relief before the latest payment pause extension ends on December 31.

Borrowers can be notified when the forgiveness application is available at this link, and tax professionals should sign up for notifications as well.

If a borrower fails to complete the application before the payment pause expires at year-end, they will still be able to get the relief.

A Master Promissory Note (MPN) is a binding legal document borrowers must sign before they receive a federal student loan.

You'll need to sign a separate MPN for direct subsidized/unsubsidized loans and another for direct PLUS loans.

All MPNs can be signed electronically, which is a convenient option.

You may receive more than one loan under an MPN over a period of up to 10 years to pay for educational costs.

The Department of Education says there will be a four- to six-week turnaround time for processing student loan forgiveness applications. This means you can expect to hear back from them within a few weeks.

Applications will be processed on a rolling basis until the December 2023 deadline. This is a crucial date to keep in mind, so mark your calendars accordingly.

The student loan repayment pause has been extended until June 30, 2023, or until legal challenges are resolved. This gives you a bit more breathing room, but keep in mind that interest will continue to not accrue until the suspension ends.

The federal government's response time can be a bit unpredictable, but there are some general guidelines to keep in mind.

If you're waiting to hear back about a student loan forgiveness application, the Department of Education estimates a four- to six-week turnaround time.

Applications will be processed on a rolling basis until the December 2023 deadline.

This means that the sooner you submit your application, the sooner you can expect to hear back from the federal government.

The extension of the pause is a significant development in the government's response to the student loan crisis.

Biden announced an extension of the student loan repayment pause until June 30, 2023, or until legal challenges are resolved, and the Department of Education (DOE) can implement the student debt relief plan – whichever is sooner.

Interest on eligible student debt will continue to not accrue until the suspension ends, and payments will resume 60 days after the pause ends. This means the next loan payments will likely be due in August 2023, assuming court challenges aren't resolved before June.

The court ruling on the student loan forgiveness plan has been a major point of contention. The Supreme Court (SCOTUS) agreed to review the plan in December, with a hearing scheduled for February 2023. This means the plan remains on hold until at least February.

The SCOTUS decision came after a federal appeals court in the eighth circuit approved a preliminary injunction suspending the relief plan in one of the cases challenging its legality. The Department of Education (DOE) has stopped taking new applications for student loan forgiveness.

Roughly 26 million borrowers have applied for student loan forgiveness since the President's August 24 announcement. However, relief will not be granted until the legal challenges are resolved.

The DOE has approved 16 million of those applications, but the borrowers will not receive relief until the court ruling is finalized. This could take some time, given the Supreme Court's schedule.