Student loans forgiven

By Raymond Nava

President Joe Biden announced on August 24 a three-part plan to forgive a portion of student loans for Americans. 

The plan, available on the website, aims to provide target relief to combat the damage done by the pandemic, make the student loan system more manageable for current and future borrowers and reduce the cost of colleges by holding schools accountable if they increase their prices. 

Additionally, Biden announced that the student loan repayment pause would be extended one final time through December 31 with repayments resuming in January of next year. 

Borrowers have until December 31, 2023 to apply for relief.

In a briefing room statement on the website. Individuals who make less than $125,000 a year, $250,000 for married couples, and have received a Pell Grant will be eligible to have up to $20,000 of their student loan debt forgiven. 

Individuals who did not receive a Pell Grant will have up to $10,000 forgiven. Individuals who are “dependent students” will have their eligibility be decided based on their parent’s income rather than their own. 

According to statistics based on analysis from the U.S. Department of Education, close to 87% of the benefits from this plan will go towards borrowers earning less than $75,000 a year.

The federal student aid website notes changes to the Public Service Loan Forgiveness Program. 

Individuals who are currently employed by nonprofits, the military or any federal, state, Tribal or local government are potentially eligible to have all of their student loans forgiven through the program. 

Temporary rule changes waive certain eligibility criteria for the program and are set to expire on October 31. Individuals who may meet the criteria have until  then to sign up for the program at the website.

It is possible for East Los Angeles College faculty to greatly benefit from this.

Stuart Souki, an associate professor at ELAC and union chair of the Los Angeles Faculty Guild (AFT 1521), said that many faculty members spend a good portion of their monthly salary paying back student their loans. 

When inflation rises, it adds an extra strain on the faculty who try to pay back their loans. ELAC faculty are prime candidates to take advantage of the Biden administration’s student debt relief plan as well as the temporary rule changes to the PSLF.

When applying for relief, there’s a chance a borrower may be automatically eligible for relief because the U.S. Department of Education may already have  the relevant income data available on file. If not, the borrower will have to fill out an application which will be available by early October. 

Relief can be expected 4-6 weeks after completion of the application. 

The financial aid website also encourages that borrowers apply before November 15 in order to get their relief before the payment pause expires at the end of the year. However, the Department of Education will continue to process applications after the pause expires.

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