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Sunday, January 23, 2022

Student Loan Forgiveness Program: Can You Wipe Out Your Debts?

The Federal Department of Education announced a new round of student loan forgiveness

Borrowers who are eligible for this round of student loan forgiveness have been notified by email, according to the Department.

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The new round, which is taking place currently, will forgive $2 billion in loans.

According to Fortune, forgiveness is part of an overhaul of the Public Service Loan Forgiveness program.

It is intended to provide loan relief to teachers, social workers, firefighters, and other public servants. People who are eligible for this program get their loans forgiven after 10 years of making payments.

How Can You Be Eligible For The Student Loan Forgiveness Program?

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The Education Department made some changes to the application process for the program going forward to make it easier for people to get loan forgiveness.

Education Secretary Miguel Cardona explained that about 30k people will get relief in the new round of waivers, which includes members of the armed forces and veterans.

After 22 months of optional federal student loan payments, millions of student loan borrowers will make their first federal student loan payment in nearly two years. 

There are 3 things to keep in mind. Firstly, you need to determine if you qualify for student loan forgiveness. Then you need to find out if you are getting a new loan servicer and lastly, consider student loan refinancing.

The department also granted relief to borrowers who attended defunct schools that had used deceptive or illegal practices. That round of student loan forgiveness benefited more than 188,000 people with $2.6 billion in debt. The multiple rounds of forgiveness represent a fraction of the total U.S. student loan debt of nearly $1.8 trillion held by 43 million people.

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