Student Loan Relief Application Site Open to VA Borrowers
VIRGINIA — Student borrowers in Virginia can now apply for $10,000 to $20,000 in student loan forgiveness, even as the president’s debt relief program faces legal challenges.
President Joe Biden recently announced the official launch of the application site for those seeking debt relief. It is estimated that 43 million borrowers could qualify for the student loan forgiveness programannounced in August.
The program offers eligible Pell Grant borrowers up to $20,000 in debt relief and $10,000 in debt relief for others. Individuals who earned less than $125,000 and families with incomes less than $250,000 in 2020 or 2021 are eligible to apply.
Income is based on adjusted gross income as reported on federal tax returns, a figure that tends to be lower than total income. Adjusted gross income is found on line 11 of IRS Form 1040.
“Today I am announcing that millions of working and middle-class people can apply and get this relief. And it’s simple and it’s now. It’s easy,” Biden said, according to CNN. “This is a game-changer for millions of Americans…and it’s taken incredible effort to build this website in such a short time.”
Applicants can complete the form in English or Spanish at studentaid.gov. The form includes information about debt relief, which is eligible for it and how it works, CNN said. To apply, provide your full name, social security number, date of birth, phone number, and email address.
December 31, 2023 is the deadline to submit an application.
- 1.08 million Virginia residents have student loan debt.
- The average debt per borrower is $39,165.
- 12.5% of residents have student loan debt.
- 14% of student borrowers in government debt owe less than $5,000.
- 22.8% owe between $20,000 and $40,000.
- 2.4% owe more than $200,000.
At least five lawsuits in courts across the country accuse President Joe Biden of overreaching the executive branch and circumventing Congress in authorizing large-scale debt relief.
The program is anchored on a 2003 law giving the Department of Education the power to waive loan requirements to help borrowers in an emergency.
The Washington Post reported that the United States Court of Appeals for the 8th Circuit ordered a stay last week of the impending forgiveness of federal student loans like a lawsuit to stop the program filed by six Republican-led states — Arkansas, Iowa, Kansas, Missouri, Nebraska and South Carolina — is making its way through the courts.
The court has accepted an expedited briefing on the states’ injunction request, but the Biden administration cannot begin canceling the loans next week as planned, the Post said. U.S. District Judge Henry E. Autrey dismissed the states lawsuit for lack of standing.
U.S. Supreme Court Justice Amy Coney Barrett denied a separate request from the Wisconsin Institute for Law and Liberty to stop the debt relief program.
The Ministry of Education has told borrowers who qualify for automatic debt relief, without filing an application, not to expect debt cancellation before Nov. 14, CNN reported.
The federal Family Education Loans program ended in 2010, and its loans were split between the Department of Education and private loan companies. Those in the latter category are generally excluded from debt cancellation programs.
Borrowers were asked to consolidate these loans into the Federal Direct Lending Program to qualify for the debt relief program. The Biden administration’s announcement of the program sparked a peak of consolidations among FFEL commercial borrowers, the Washington Post reported.
However, the department changed directions about two weeks ago. Now only those who consolidated their loans before September 29 are eligible. According to The Post, the change affected nearly 800,000 borrowers.
Other legal challenges have been filed by the state of Arizona, a Wisconsin taxpayer group, a former U.S. Senate candidate from Oregon and a libertarian lawyer from Indiana to stop the pardon plan, a reported Bloomberg.
In 2021, nearly 166 million borrowers collectively owe $1.59 trillion in student loans, more than Americans owe on their auto loans or credit card balances, according to the agency’s latest report. Experian credit reporting. Student Loan Debt Status Report.
The average balance per borrower increased slightly in 2021 to $39,487, up nearly $700 from 2020, according to Experian.
An August survey by credit monitoring firm ScoreSence found that only 14% of U.S. borrowers with federal student loans on pause could allow payments no problem at the end of the abstention period. The survey also found that 42% of borrowers don’t know how they will fit loan payments back into their budget.