Ready for Relief

What to know about the upcoming student loan forgiveness program

Finally, after a lot of discussions, the federal student loan forgiveness program is upon us. The government has said that October is when the program will launch, so here’s a breakdown of what you need to know.

Who Gets It

If you have a federal student loan and an income less than $150,000 (or $250,000 for your household) you will be eligible for relief. If you have a Pell Grant, you can get up to $20,000 canceled. If you don’t, you’ll get up to $10,000 forgiven.

Pell Matters

As you can see, if you had a Pell Grant, your loan forgiveness will likely be significantly higher than someone without a Pell Grant. Perhaps you don’t remember if you have one of those grants. If so, create an FSA ID account at StudentAid.gov, if you don’t already have one. When you log in, you’ll see if you have a Pell Grant, how much you owe on your loans, and the name of your loan servicer.

Get Set

Speaking of your loan servicer, make sure your contact information is up to date because once the relief gets applied, your servicer will be the one to alert you.

When It’s Time

As USA Today notes, as of this week, the government hasn’t set an official start date for the student loan relief program. However, they have said it will begin in October, so you want to be ready when things do kick into gear.

Chris O'Shea/SavvyMoney