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US President Joe Biden announces student loan debt relief with Education Secretary Miguel Cardona … [+]<\/span> (R) on August 24, 2022 in the Roosevelt Room of the White House in Washington, DC.(Photo by OLIVIER DOULIERY \/ AFP) (Photo by OLIVIER DOULIERY\/AFP via Getty Images)<\/span><\/p>\n <\/fbs-accordion>AFP via Getty Images<\/small><\/figcaption><\/figure>\n The Education Department has quietly updated the anticipated timeline for borrowers seeking student loan forgiveness under a one-time account adjustment<\/a>. Here\u2019s the latest.<\/p>\n The Biden administration first announced<\/a> the IDR Account Adjustment last year, billing it as a one-time fix to longstanding problems with Income Driven Repayment (IDR) plans. These repayment plans allow borrowers to repay their federal student loans<\/a> according to a formula applied to their income and family size. IDR plans also provide for student loan forgiveness for borrowers who have not repaid their federal loans in full within 20 to 25 years, depending on the specific IDR program.<\/p>\n Under the original IDR framework, generally only time spent in an IDR plan can count towards loan forgiveness (with some rare exceptions, like an economic hardship deferment). But under the IDR Account Adjustment, the Education Department will be able to retroactively credit borrowers with time towards the 20-year or 25-year student loan forgiveness thresholds, even for borrowers who haven\u2019t been in an IDR plan. The Education Department says it can count any past period of repayment, along with certain broad categories of prior deferments and forbearances, including for periods prior to loan consolidation (historically, consolidation would restart the clock on a borrower\u2019s IDR term).<\/p>\n These periods can also count towards Public Service Loan Forgiveness (PSLF)<\/a> for borrowers who work for qualifying nonprofit or government organizations and meet other PSLF eligibility criteria.<\/p>\n According to the Education Department, borrowers who cross the 20 or 25-year threshold following the account adjustment would receive student loan forgiveness, as well as a refund of any overpayments. Other borrowers who gain credit under the adjustment, but fall short of the threshold for loan forgiveness, would need to continue making payments under an IDR plan to make continued progress.<\/p>\n When the IDR Account Adjustment was first announced last April, the Education Department published guidance stating that borrowers could start receiving student loan forgiveness by the the fall of 2022, and all others should receive their one-time retroactive credit by January. While PSLF borrowers did start receiving credit under the IDR Account Adjustment lat fall, the Education Department has been gradually pushing back other relief under the initiative.<\/p>\n In updated guidance released last fall, the Education Department maintained that borrowers who cross the 20 or 25-year threshold following the account adjustment would start receiving student loan forgiveness in the fall of 2022, but that all other borrowers would not receive retroactive IDR credit until July 2023.<\/p>\n In more recent updates to published guidance just last month, the Education Department appears to have quietly pushed out the debt relief a bit more. \u201cBased on the newly eligible months from the one-time account adjustment, borrowers who have reached 240 or 300 months\u2019 (as applicable) worth of payments for IDR forgiveness or 120 months of PSLF will begin to see their loans forgiven in spring 2023,\u201d says the updated guidance. The Education Department now says that other borrowers will receive their retroactive IDR Account Adjustment credit \u201cin summer 2023\u201d \u2014 seemingly no longer committing to a concrete implementation deadline of July, and suggesting that it may take until August or even September 2023.<\/p>\n The delays may be related to the fact that Congress did not provide additional funding<\/a> to the Education Department\u2019s Office of Federal Student Aid in the most recent omnibus bill.<\/p>\n Borrowers who already have government-held federal student loans, such as Direct loans, should receive the benefits of the IDR Account Adjustment automatically. But these borrowers may want to explore switching to an IDR plan if they are not already in one and anticipate receiving significant retroactive credit under the initiative.<\/p>\n According to the Education Department, \u201cBorrowers who have commercially managed FFEL, Perkins, or Health Education Assistance Loan (HEAL) Program loans should apply for a Direct Consolidation Loan by May 1, 2023, to get the full benefits of the one-time account adjustment.\u201d The Education Department has not changed the May 1 consolidation deadline since it updated its guidance last fall.<\/p>\n All borrowers should carefully review the administration\u2019s published guidance<\/a> on the account adjustment, which is periodically updated, often without any formal announcement.<\/p>\n Separately, last week the Biden administration announced it would be implementing significant reforms<\/a> to a key IDR plan called Revised Pay As You Earn (REPAYE), which may significantly lower monthly payments<\/a> and reduce student loan forgiveness thresholds for millions of borrowers. However, the Education Department has not provided a specific timeline for anticipated implementation of the new program.<\/p>\n Biden Announces New Student Loan Plan: 8 Big Details On Forgiveness And Payments<\/a><\/p>\n Here\u2019s What You\u2019ll Pay, And When You\u2019ll Get Student Loan Forgiveness, Under Biden\u2019s New Plan<\/a><\/p>\n Student Loan Forgiveness Could Be Big In 2023: Here\u2019s What To Expect<\/a><\/p>\n The Student Loan Pause Is Actually Leading To Loan Forgiveness \u2014 Are Further Extensions Coming?<\/a><\/p>\n<\/div>\n\n US President Joe Biden announces student loan debt relief with Education Secretary Miguel Cardona … [+] (R) on August 24, 2022 in the Roosevelt Room of the White House in Washington, DC.(Photo by OLIVIER DOULIERY \/ AFP) (Photo by OLIVIER DOULIERY\/AFP via Getty Images) AFP via Getty Images The Education Department has quietly updated the …<\/p>\n","protected":false},"author":1,"featured_media":46971,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[161],"tags":[],"_links":{"self":[{"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/posts\/46970"}],"collection":[{"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/comments?post=46970"}],"version-history":[{"count":0,"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/posts\/46970\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/media\/46971"}],"wp:attachment":[{"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/media?parent=46970"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/categories?post=46970"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/tags?post=46970"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Student Loan Forgiveness Under Biden\u2019s IDR Account Adjustment<\/strong><\/h2>\n
Updated Timeline for Student Loan Forgiveness Under Account Adjustment<\/h2>\n
Next Steps for Borrowers Seeking Student Loan Forgiveness Under Account Adjustment<\/h2>\n
Further Student Loan Forgiveness Reading<\/strong><\/h2>\n
Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"