Last August, President Biden made good on his campaign promise to forgive federal student loans for 43 million Americans. Borrowers were overjoyed and flocked to the application portal when it opened a few weeks later and showed their support at the voting booths for Democratic leaders who responded to their cries for debt relief.
But as quickly as hope appeared, legal challenges from Republicans and conservative groups halted the plan. Yet, the White House refuses to give up. The U.S. Department of Education is eager to start canceling student loan debt when the Supreme Court gives the okay.
Here’s what this means for Parent PLUS Loan borrowers.
Parents who earned less than $125 thousand during either of the first two years of the pandemic can get $10 thousand of forgiveness for the Direct PLUS Loans they borrowed for their child’s education. That amount jumps to $20 thousand for parents who went to college and received a Pell Grant, a type of aid given to low-income undergraduate students.
According to a report from The Century Foundation, the Biden administration’s loan cancellation plan could be a lifesaver for the 3.7 million families burdened with Parent PLUS Loans, many of which are low-income Black and Latino families.
So, if you’re one of the millions of Americans facing Parent PLUS Loans, this plan could offer a glimmer of hope and real relief.
Related: Parent PLUS Loan Forgiveness During COVID