BUFFALO, N.Y. (WIVB) — Information on how to receive loan forgiveness will be released in the coming weeks but there are things borrowers can do now to make sure they receive that information and prepare for how much they’ll be getting back.
Anyone who earned less than $125,000 per year in the 2020 or 2021 tax year or married couples who earned less than $250,000 are eligible for loan forgiveness.
People in that group will have $10,000 forgiven and those who also received a PELL grant are eligible for another $10,000. They’ll receive $20,000 total.
“Everyone who has a loan has a loan servicer and you want to check with your servicer to make sure they know what your email is and your current address and they’ve got information on you,” said Anthony Ogorek, president of Ogorek Wealth Management.
He said people can start by going to ed.gov/subscriptions to receive updates about forgiveness.
The Biden administration is also proposing a new income-driven repayment plan intended to reduce monthly payments for lower and middle income borrowers.
“Bottom line is the less you end up having to pay for debt repayment the more you have available for other types of spending.”
With that being said, Ogorek also said this could be a distraction from a bigger problem: the rising price of college.
“I think if we had a program where you were able to trade years in service to the country in certain occupations in some sort of debt subsidy or forgiveness I think that would make a lot of sense but what we have now just isn’t controlling costs at all unfortunately,” Ogorek said.
The pause on student loan repayment will continue through December 31 but borrowers should expect to start paying again in January.