MARQUETTE, Mich. (WZMQ) – Recently, the Biden-Harris administration announced a three-part student loan forgiveness plan that will affect the working and middle-class federal loan borrowers transition back to regular payments as the pandemic-related support ends.
This plan includes loan forgiveness of up to $20,000.
Shawn Olson, assistant director of Northern Michigan University’s financial aid office, said that the first step in applying for aid is to make sure their contact information is correct on the studentaid.gov website.
“Get those things updated with your student loan servicing company where you’ve been making payments or where you’ve been getting notifications about your student loans,” Olson said.
Borrowers can subscribe to receive updates on the loan forgiveness plan by going to the subscriptions subpage on the studentaid.gov website and putting in their email address along with marking which updates you would like to receive including the loan forgiveness.
The final day to apply for aid is December 31, 2023.
According to the U.S. Department of Education, the department will provide up to $20,000 in debt relief to Pell Grant recipients with loans held by the Department of Education and up to $10,000 in debt relief to non-Pell Grant recipients. Borrowers are eligible for this relief if their individual income is less than $125,000 or $250,000 for households.
To be eligible for student loan forgiveness, your annual income must have fallen below $125,000 for individuals or $250,000 for married couples or heads of households.
If you received a Pell Grant in college and meet the income threshold, you will be eligible for up to $20,000 in debt relief.
If you did not receive a Pell Grant in college and meet the income threshold, you will be eligible for up to $10,000 in debt relief.
What this means is that if you are eligible for $20,000 in debt relief but have a balance of $15,000 remaining, you will only receive $15,000 in relief.
Since the recent announcement, many students on campus at NMU have mixed feelings. Some students confused are confused about what this all means, others are looking forward to having loans forgiven.
“I’m sure my mom is going to be appreciative,” Ayanna Allen, student at NMU, said. “She took out a lot of parent loans for me to come to school so the fact that there’s going to be loan forgiveness for the ones I took out, it’s going to make it much easier for me to pay her back.”
There are some students even who worry about how this will play out for taxpayers.
“I know back home my family isn’t the biggest fan of this,” Elsie Ramsey, student at NMU, said. “Potentially because they’re going to have to pay more in taxes and things to cover it and there’s a reason they didn’t attend college or have attended college and paid it off.”
Olson stressed the importance of signing up for updates as new information is coming out daily. For those attending NMU, the Financial Aid office in C.B. Hedgcock will be able to help guide applying for aid as well as understand the relief plan further.
For more information on the student loan relief plan, visit https://studentaid.gov/debt-relief-announcement/.