Your student loan forgiveness questions, answered

The school type doesn’t matter but it does matter the type of loan you took out.
Many borrowers hope some of their loans will be forgiven under President Biden's new program.
Published: Aug. 30, 2022 at 7:02 PM CDT
Email This Link
Share on Pinterest
Share on LinkedIn

OMAHA, Neb. (WOWT) - According to LendingTree, the average student loan balance in Douglas County is about $32,000.

Many borrowers are hoping at least some of their loans will be forgiven thanks to the new program announced by President Biden. 6 News asked college students their biggest questions and got them answered by experts.

“Who qualifies for the loan forgiveness?” asked one Creighton student.

“The last week’s announcement from President Biden, anyone with federal loans would qualify,” said Hannah Young, communications manager for the Nonprofit Association of the Midlands.

But your annual income must be below $125,000 for individuals or $250,000 for married couples. Parents who took out Parent Plus federal loans can still get this money but must fall under the same income requirements.

“My biggest question is, how much is it?” asked another student.

“It’d be $10,000 for anyone who took out general loans and $20,000 for anyone who had Pell Grants during any course of their college career.”

“Why do some students get $20,000 and others get $10,000?”

“You’d have to be under a certain family income threshold and that you would automatically get a Pell Grant,” said Young.

Recipients of Pell Grants are considered low-income and in more need of financial aid. According to the Department of Education, most Pell Grant recipients come from families making less than $40,000 a year. About 27 million people are eligible for that $20,000 in relief for Pell grant recipients.

“Is it only applied to people that go to private school or public schools?”

The school type doesn’t matter but it does matter the type of loan you took out.

“If you have any private loans, those do not count under this federal forgiveness.”

Only loans taken from the federal government, not banks or private lenders qualify.

According to a White House press release, about eight million people will get their loans automatically forgiven based on income information already available to the Department of Education. But most people will need to fill out an application once it goes live this October. If you’re unsure whether you need to fill one out, experts tell 6 News it’s best to just do it anyway.

You can subscribe for updates to know when the application goes live here.