The Administration’s plan includes targeted debt relief for many borrowers, additional relief for families with low to moderate incomes, and a final extension of the student loan repayment pause.
One-Time Student Loan Debt Relief
You may be eligible for debt cancellation on your U.S. Department of Education (ED)-owned federal student loans (including undergraduate loans, graduate loans, spousal loans, Parent PLUS and Grad PLUS loans) if your individual income is less than $125,000 or $250,000 for households.
If you received a federal Pell Grant in college and meet the income threshold, you may be able to get up to $20,000 in debt cancellation.
If you did not receive a federal Pell Grant in college and meet the income threshold, you may be able to get up to $10,000 in debt cancellation.
The application will be available online by early October 2022, though details continue to emerge.
The deadline to submit the application is December 31, 2023. However, U.S. ED recommends applying by November 15, 2022 to receive relief before the repayment pause ends. U.S. ED will process applications received after November 15, 2022 on a rolling basis.
Learn more about the student loan debt relief plan.
Subscribe to U.S. ED to get the latest updates.
NYC Financial Empowerment Center counselors can guide you on how to apply for one-time student loan debt relief once the application becomes available in October 2022. Visit the Financial Counseling page to schedule an appointment.
Final Extension of Repayment Pause
On March 20, 2020, the office of Federal Student Aid began providing the following temporary relief on U.S. Department of Education (ED)-owned federal student loans:
- Suspension of loan payments,
- Stopped collections on defaulted loans, and
- 0% interest rate.
These COVID-19 emergency relief measures were extended on U.S. ED-owned federal student loans through December 31, 2022.
This temporary relief does not apply to private student loans.