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Latest News on Federal Student Loan Forgiveness

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Latest News on Federal Student Loan ForgivenessFSA recently provided updates to the Student Debt Relief Plan. This information is important for former students or college graduates with outstanding federal student loans. There are two important things to remember right now regarding student loan forgiveness: these changes apply only to federal student loans and there may still be some opposition or changes to the plan. The plan will also affect future payments by creating a new income-driven repayment plan.

The following types of federal student loans with an outstanding balance as of June 30, 2022, are eligible for relief:

      • William D. Ford Federal Direct Loan (Direct Loan) Program loans
          • Subsidized loans
          • Unsubsidized loans
          • Parent PLUS loans
          • Graduate PLUS loans
      • Federal Family Education Loan (FFEL) Program loans held by ED or in default at a guaranty agency
      • Federal Perkins Loan Program loans held by ED
      • Defaulted loans (includes ED-held or commercially serviced Subsidized Stafford, Unsubsidized Stafford, parent PLUS, and graduate PLUS; and Perkins loans held by ED). If you have a remaining balance on your defaulted loan(s) after relief is applied, consider getting or staying out of default through the Fresh Start initiative.
      • Consolidation loans are eligible for relief, as long as all of the underlying loans that were consolidated were first disbursed on or before June 30, 2022.


Student loan repayments will restart in January 2023. Be aware of this timeframe if you have outstanding federal student loans. That being said, here is information from the latest White House Fact Sheet and FSA sources regarding the COVID-relief loan forgiveness program:

      • Over 40 million borrowers are eligible for the student debt relief plan; nearly 20 million could see their entire remaining balance discharged.
      • Additional details will be released soon about the debt relief plan from the Department of Education.
      • Unless changes are made in their state laws, seven states may tax forgiven debt. Those states are Arkansas, California, Indiana, Minnesota, Mississippi, North Carolina and Wisconsin.
      • The U.S. Department of Education will provide up to $20,000 in debt cancellation to Pell Grant recipients with loans held by the Department of Education and up to $10,000 in debt cancellation to non-Pell Grant recipients. Borrowers are eligible for this relief if their individual income is less than $125,000 or $250,000 for households. Get details about one-time student loan debt relief.
      • Relief is capped at the amount of outstanding debt. You will not receive funds if your debt is less than the potential relief amount.
      • Nearly 8 million borrowers may receive relief automatically because relevant income data is already available to the Department of Education. If the Department of Education doesn’t have your income data, there will be a simple application, which will be available soon. Log in to your account on and make sure your contact info is up to date to receive updates by both email and text message.
      • If you would like to be notified when the application is open, sign up at the Department of Education subscription page. If you must complete an application for relief, you are advised to do it by November 15, 2022, to have the funds applied before repayment begins in January.
      • This relief applies only to federal student loans received before June 20, 2022. No loans disbursed after that date will be included in this program.
      • Your loan servicer will notify you when the relief has been applied to your account, with details on how the relief was applied.
      • You are eligible for a refund if you made voluntary payments during the pandemic.
      • Beware of potential scams – you will not be charged for loan relief.


CFAA consults with students and parents to plan for every step of the college financial aid process, from completing the FAFSA and completing the CSS Profile to comparing financial aid offers and understanding student loan options. Schedule a CFAA new client free strategy session or a 15 Minute Power Chat to learn more about finding ways to pay for college. To get the latest financial aid information and college application to-do lists, look for my bi-weekly JustAskJodi emails and check out my monthly CFAA e-newsletter.

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