‘I didn’t think it would actually happen’: Biden Announces Debt Relief Plan
College students are eligible to get up to $20,000 of their federal student loans forgiven once the form is released
September 29, 2022
U.S. President Joe Biden announced on Aug. 24 a one-time student loan debt relief plan that is intended to forgive federal student loans for low and middle income families. According to the U.S. Department of Education’s student aid website, an online form will be made available for those who are eligible for the debt relief program by early October, with the deadline to submit the application by Dec. 31, 2023.
Under the forgiveness program, loans taken out prior to June 30, 2022, qualify. These include ones under the William D. Ford federal direct loan program, which consists of subsidized, unsubsidized, parent and graduate PLUS loans, Federal Family Education Loan program loans, Federal Perkins loans and defaulted loans.
In order to be eligible for the debt relief program, an individual’s annual income, married or single, cannot exceed $125,000 if they file separately for their tax returns. If an individual files their tax returns jointly due to marital status or because they are the acting head of household, their income cannot exceed $250,000.
There are two qualifications for debt relief assuming an individual falls below the income threshold: If a student received a Pell Grant as a part of their financial aid offer in college and fall, they can get $20,000 of their loans forgiven or they can get $10,000 in student loans forgiven if they are a non-Pell Grant recipient.
A federal Pell Grant is awarded to undergraduate students who demonstrate an exceptional need for financial aid. The grant is awarded to students who are in the process of pursuing a bachelor’s, graduate or professional degree.
Any student who has received at least one Pell Grant of any amount throughout their college career is eligible to receive the full $20,000 in student loan debt relief. Federal aid is determined through the Free Application for Federal Student Aid (FAFSA). To check if they qualify or have received a Pell Grant, students can log onto their FAFSA account and check the financial aid offers outlined in their package.
Brian Ghanoo, associate vice president for student financial services, noted that if students are eligible for a Pell Grant, it should be listed as a part of their financial aid offer which is viewable on their financial aid portal.
Ragusa noted there should be better programs in place to help students learn about how to handle their debt, suggesting courses that can help provide ideas, guidance and information about loans.
Alisha Alam, Fordham College at Lincoln Center ’24, said that when she first learned about Biden’s student loan forgiveness program, she was relieved and surprised.
“I didn’t think it would actually happen,” she said. “I personally have both Federal loans and Private loans to cover my tuition at Fordham so it is a big help.”
Hannorah Ragusa, Fordham College at Rose Hill ’26 and a student who qualifies for $10,000 in student loan forgiveness, shared that at first she was excited about the program’s announcement but then felt less enthusiastic after hearing more information.
“As much as I appreciate the help, it feels superficial,” she said. “I think it helps but more should still be done.”
Ragusa noted there should be better programs in place to help students learn about how to handle their debt, suggesting courses that can help provide ideas, guidance and information about loans. She also believes that if she knew more about her options, “the whole concept of student debt wouldn’t seem so scary.”
Alam shared that she had heard about the program through TikTok and continued to research the initiative on her own. Despite her efforts, she had outstanding questions about the process of loan forgiveness.
“I’m hearing different things about it, and anytime I try to search up information on it on the FAFSA website, it all seems confusing and a bit vague,” she said.
Alam expressed confusion regarding the process and wondered if those who have already made their payments will be compensated.
According to the Department of Education’s website, individuals can get a refund for any payments they have made during the payment pause enacted since March 13, 2020 by contacting their loan service provider to request a refund.
According to the Department of Education’s website, individuals can get a refund for any payments they have made during the payment pause enacted since March 13, 2020 by contacting their loan service provider to request a refund.
Ghanoo shared that there are various types of student loan forgiveness and recommended the Department of Education’s website as a resource to understand the different types of loan cancellation, forgiveness and discharge. He also noted that the Office of Financial Aid placed information on both the undergraduate and graduate financial aid web pages about loan forgiveness.
Alam shared that she intends to utilize Fordham’s financial aid office as a resource when the time comes to file for student loan forgiveness. She added her hope that the financial aid office will send out emails updating students on the program when the application goes. She said that since the semester is a busy time for students, she anticipates needing a lot of help during this process.
“I will definitely be reaching out to the financial aid office to guide me through the process,” she said. “I hope they can help.”
The Biden student loan debt relief program intends to make the loan system more manageable for borrowers and hopes to provide relief for up to 43 million borrowers, according to a fact sheet released by the White House.
Jim Cirillo, campus director of student financial services, shared that the university has not received further information from the Department of Education regarding the student loan forgiveness program. He emphasized that students will likely have to work directly with the federal government to work on getting their loans forgiven.
Ghanoo echoed this sentiment and expressed that students will be in direct contact with the Department of Education in order to process their loan forgiveness.
“The Department of Education will not be providing training for staff at colleges or universities on the application process,” he said. “Students must work with the Department of Education directly to navigate the application process.”
The Biden student loan debt relief program intends to make the loan system more manageable for borrowers and hopes to provide relief for up to 43 million borrowers, according to a fact sheet released by the White House. While awaiting the application, individuals are encouraged to ensure that their contact information is accurate so that they can be reached by their loan servicers and to sign up to receive text and email notifications.
