President Biden’s student debt relief plan, distinct from broad federal student debt cancellation, provides one-time relief. Under this U.S. Department of Education initiative, eligible borrowers could receive up to $20,000 if they previously received a Federal Pell Grant or up to $10,000 if they didn’t, based on income thresholds as shown on their income tax return.
Related: Student Loan Forgiveness Income-Limit
But courts have temporarily blocked this relief program, halting application acceptance. If you’ve already applied, your application will be held.
Eligibility is determined by individual income, less than $125,000, household income under $250,000, and having loans held by ED. Check StudentAid.gov for updates.
The following federal student loans with an outstanding balance as of June 30, 2022, qualify:
William D. Ford Federal Direct Loan (Direct Loan) Program 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, including ED-held Subsidized Stafford, Unsubsidized Stafford, Perkins Loans, Graduate PLUS, and Parent PLUS Loans.
Federal Direct Consolidation loans, given that all consolidated loans were ED-held and disbursed on or before June 30, 2022.
Additionally, Consolidation loans involving any FFEL or Perkins loans not held by ED qualify if the borrower applied for consolidation before September 29, 2022.