Last year, the Biden administration announced their much-anticipated student loan forgiveness plan. As a result, millions of Americans were hoping to be relieved of the repayment responsibility for up to $10k in student loan debt and up to $20k for eligible Pell Grant recipients. However, in a recent decision, the U.S Supreme Court has struck down President Biden’s student loan forgiveness plan.
The loan forgiveness plan did not apply to private student loans. Private loans are issued by financial institutions, not the U.S Department of Education.
When the President’s student loan forgiveness plan was first introduced, it was estimated that nearly 15 million borrowers could have their loan debt forgiven and millions of others would have both their balance and payments reduced.
Although this debt relief is no longer a possibility, the administration is still working to provide some assistance with the implementation of income driven repayment plans. Details of the repayment plans can be found here.
Student loan repayments have been on pause (forbearance) since the beginning of the pandemic in March of 2020. Payments were supposed to resume in early 2023. The Department of Education extended the pause which will end this fall. Student loan interest will resume on September 1, 2023, and payments will be due beginning in October.
If you currently have private student loan(s), you may consider reaching out to the lender to try negotiating more favorable loan terms.
It is our pleasure to address any questions you may have. Additionally, let us know if you’d like assistance managing your cash flow as you plan for the loan repayments to return.