How to Apply for Student Loan Forgiveness Before the Official Date

Millions of Americans will be able to apply for student loan forgiveness via a beta application before the program officially opens later this month.

President Joe Biden announced a controversial student loan forgiveness package in August that aims to reduce the amount of debt former students currently face. His plan allows single borrowers who earn less than $125,000 to cancel $10,000 worth of loan debit, while married couples with a joint income of $250,000 can eliminate $20,000.

According to the Education Data Initiative, an education-centered research team, 43 million borrowers in the country have federal student loan debt. The average balance of federal student loan debt is $37,667.

The Department of Education estimates that 81 percent of those eligible will take steps to get relief. It also expects that 90 percent of relief dollars will go to those earning less than $75,000 per year.

However, the U.S. Department of Education estimates the one-off debt relief will cost an average of $30 billion over the next decade. It also added that the 10-year cost in terms of reduced cash flows into the government would be roughly $400 billion.

In response to the president's announcement, six Republican-led states launched lawsuits against the plan alleging that Biden does not have the right to eliminate student loans. The states contesting the president's plan are Arkansas, South Carolina, Iowa, Kansas, Nebraska, and Missouri.

Arkansas Attorney General Leslie Rutledge is leading the joint effort among the GOP states. The states are requesting a temporary pause on the program, contending that Biden's student debt relief plan hurts private lenders and accusing Biden of calling the pandemic "over," which contradicts the student debt relief's purpose of being hinged on the ongoing pandemic.

The application is now live via a beta online application, which can be used ahead of the official launch. Federal Student Aid said the beta launch will refine its process and that those who submit an application during this phase will not need to resubmit.

Here is some key information for those who want to apply:

See if You Qualify

You may receive debt relief if you have eligible federal loans and meet the following 2020 or 2021 income requirements:

• You made less than the required income to file federal taxes
• You are single and earn under $125,000
• You are married, earn under $125,000 and file your taxes separately
• You are married, earn $250,000 combined and filed your taxes jointly
• You are the head of a household and earn under $250,000
• You are a qualifying widow(er) and earn under $250,000

If you have either federal student loans and meet the requirements, it does not matter if you have been repaying your student loans or are in school.

See if Your Loan Is Eligible

The following loans disbursed on or before June 30, 2022, are eligible for relief:

• William D. Ford Federal Direct Loan (Direct Loan) Program loans
• Federal Family Education Loan (FFEL) Program loans held by ED or in default at a guaranty agency
• Federal Perkins Loan Program loans held by ED
• Defaulted loans (includes ED-held or commercially serviced Subsidized Stafford, Unsubsidized Stafford, parent PLUS, graduate PLUS; and Perkins loans held by ED)

Find Your Loans and Loan Servicers

Borrowers can log in to StudentAid.gov and select "My Aid" in the dropdown menu under their name to find the services for their loans.

The "Loan Breakdown" section will show you the loans you have received as well as the ones paid off or consolidated into a new loan.

Borrowers can also check "View Loans" and select "View Loan Details" where you will find more detailed information about that loan.

Beware of Scams

A company or group might contact you claiming they can help you get loan forgiveness or debt relief for a fee. Borrowers will never have to pay for federal student aid and will never be asked to reveal personal information.

Verified emails come from: noreply@studentaid.gov, noreply@debtrelief.studentaid.gov or ed.gov@public.govdelivery.com.

Scams can be reported to the Federal Trade Commission (FTC) by calling 1-877-382-4357 or by visiting reportfraud.ftc.gov.

Apply for Debt Relief

Borrowers should make sure their contact information is up to date with their loan servicer and check their emails or mail for up-to-date information.

The application is a short online form, which can be accessed here. Borrowers will not need to log in or provide any documents.

According to the U.S. Department of Education, applications will be available "on and off" during the beta period, so continue to try if it is not available.

For those who cannot apply online, a paper version of the form will be "available soon," according to Federal Student Aid. You will have until the end of 2023 to apply.

Most borrowers will only receive debt relief if they submit an application. However, there are exceptions, which can be seen on the Federal Student Aid website, which can be accessed here.

Needing More Help

If you need more information or help, visit StudentAid.gov for the latest updates on the application process. Those who need help filling out the form online or who have questions about their situation, can contact 1-833-932-3439 for more assistance.