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Tens of thousands of borrowers with federal student loans are probably wondering: Is my debt load about to get a little lighter?
The Biden administration announced Friday that more than 800,000 borrowers would have their remaining loan balances erased, a total of $39 billion, as part of a program to address past errors made by loan servicers who failed to give payment credit where it was due — or who may have provided poor advice when borrowers called for assistance.
In the coming days and months, thousands of borrowers will learn whether they received an account adjustment resulting in enough qualifying payments to eliminate their loans — a process that will continue until the end of the year. After that, borrowers who don’t yet have enough qualifying payments for cancellation will receive their updated payment counts.
Here’s what we know about who’s eligible:
Who qualifies?
Borrowers with direct loans or those made through the Federal Family Education Loan, or FFEL, program and held by the Education Department may qualify, including borrowers with Parent PLUS loans.
But borrowers are eligible for debt cancellation only if they have either reached a certain threshold or accumulated the equivalent of either 20 or 25 years of qualifying months.
