11/15/24

ED: Income Contingent Repayment Plan Options

The Department of Education has issued an interim final rule (IFR) to amend regulations governing income-contingent repayment (ICR) plans for federal student loan borrowers. This rule adjusts the enrollment deadline for borrowers in the ICR or Pay As You Earn plans, extending the date from July 1, 2024, to July 1, 2027. The change is a temporary measure to ensure compliance with the Department's legal obligation under the Higher Education Act of 1965 to provide borrowers access to ICR plans. These plans were originally slated to sunset for new enrollees on July 1, 2024. The interim final rule is slated for early implementation on or around December 16. That date reflects when the Department anticipates being ready to process borrower applications for these plans. We are still awaiting further operational guidance on this development. Source: AAMC's FIRST Team

10/18/24

ED: Online Application for IDR Plans Back Online

After a period where online IDR (income-driven repayment) plan applications were not being processed, processing has resumed. Borrowers who wish to re-certify their income or enter a new plan can do so here. Source: NASFAA. 

7/31/24

Federal Appeal Court Fully Blocks SAVE Repayment Plan.

Details can be found here. Our office strongly advises that you engage directly with your loan servicer to understand how your repayment plan may be impacted.

4/10/24

Changes to the PSLF Program Begin in May 2024

Please note the new information pertaining to Public Service Loan Forgiveness linked here.

2/20/24

One Time Payment Count Adjustment (source: Higher Education Financial Wellness)

Many student loan borrowers have an opportunity to have their entire student loans cancelled or receive more credit towards cancellation.  But there is an impending deadline that requires immediate action from certain borrowers who have student loans. While any borrower is potentially eligible, older borrowers are more likely to need to take immediate action because of the types of loans these borrowers frequently have. We need your help in getting these borrowers the information they need so that they can get their loans cancelled as soon as possible.

WHAT: The U.S. Department of Education (ED) will be conducting a one-time payment count adjustment. Specifically, ED will give borrowers credit towards loan cancellation through its Income Driven Repayment program (IDR) for repayment periods since July 1, 1994, and for certain deferments and forbearances. IDR programs result in loan cancellation after 20 or 25 years of eligible payments; the account adjustment will ensure borrowers receive credit for the maximum number of
eligible payments based on their loan history. This program has already resulted in cancellation of loans for more than 800,000 borrowers. In addition, IDR plans can make monthly payments more affordable by capping monthly payments based on borrowers’ income and family size, not loan balances.

Most federal student loans qualify for at least one IDR plan and federally held loans will automatically be subject to the pay count adjustment. However, some loans aren’t eligible for these programs unless consumers take further action, and the borrowers who have these loans are the ones we are now trying to reach.

WHO: ED will apply the account adjustment to most federally held student loans. However, consumers who have certain types of loans must first consolidate their loan into a Direct Consolidation loan to maximize the effect of the account adjustment. These loans include, Parent PLUS, Commercially managed Federal Family Education Loan (FFEL), Perkins loans, and Health Education Assistance Loan (HEAL) Program loans.

WHEN: The one-time pay count adjustment will occur in Summer 2024. But borrowers who have non-federally held loans must consolidate their loans into a Direct-Consolidation Loan by APRIL 30, 2024.

ACTION PLAN FOR BORROWERS

(1)   Learn whether you have a loan that must first be consolidated into a Direct-Consolidation Loan to benefit from the account adjustment. To find out call ED at 1-800-433-3243 or go to, studentaid.gov.

(2)   If you have a one of the kinds of loans that requires consolidation, apply to consolidate your loan no later than April 30, 2024 at https://studentaid.gov/loan-consolidation/.

(3)   To continue earning credit towards loan forgiveness after April 30, 2024, enroll in an IDR plan at, https://studentaid.gov/idr/.

ADDITIONAL RESOURCES:
Get more information about the one-time pay count adjustment:

-https://studentaid.gov/announcements-events/idr-account-adjustment

Learn about the benefits and disadvantages of consolidating a student loan:

-https://studentaid.gov/help-center/answers/article/pros-and-cons-of-consolidation

Find more information about student loan forgiveness:

-https://www.consumerfinance.gov/paying-for-college/student-loan-forgiveness/

Learn how to enroll in an Income Driven Repayment Plan:

-https://www.consumerfinance.gov/ask-cfpb/how-can-i-enroll-in-income-driven-repayment-en-2138/

Get help filling out consolidation forms:

-Call 1-800-4-FED-AID (433-3243)

Latest News

Student Loan Scams

As repayment for student loans begins, please be cautious of scams from malevolent actors.

1. Rely on information from trusted sources: studentaid.gov; https://students-residents.aamc.org/financial-aid.
2. Protect your personal information including FSA account information; be especially cautious if you receive an unexpected phone call.
3. Loan forgiveness or debt reduction claims except official information from the Department of Education should not be trusted.

Biden Administration Introduces New Borrower Relief Efforts

On the heels of the June 30th U.S. Supreme Court ruling striking down the Biden Administration’s debt forgiveness plan,
the U.S. Department of Education announced several new efforts to pursue debt relief for borrowers:

• The Saving on a Valuable Education (SAVE) plan will serve as the default Income-Driven Repayment plan once student loan payments resume this fall. Touted as the “most affordable repayment plan in history”, the SAVE plan increases the non-discretionary income threshold from 150% to 225% of the Federal Poverty Guideline; ceases charging monthly interest not covered by the borrower’s payment under the SAVE plan which will eliminate growing unpaid interest; and allows married borrowers who file their taxes separately to exclude their spouse’s income from the SAVE payment calculation. Borrowers will see additional benefits July 1, 2024, when the SAVE plan is fully implemented. Those interested can sign up for the SAVE plan now via the Federal Student Aid website.
• The Department will conduct a new negotiated rulemaking using authority under the Higher Education Act to seek loan forgiveness following the Supreme Court’s ruling on debt forgiveness. The Department intends to regulate on the authorities granted under section 432(a) of the Higher Education Act. This initiates the standard federal regulatory process for changes to student aid and could take several months before we see an outcome.
• The Department will provide a 12-month “on-ramp” (October 1, 2023 to September 30, 2024) for borrowers resuming repayment in October. During this transition period, monthly payments will be due, and interest will accrue; however, interest will not capitalize at the end of the on-ramp period. Additionally, borrowers will not be reported to credit bureaus, be considered in default, or referred to collection agencies for late, missed, or partial payments during the on-ramp period. The Department indicates that borrowers who can pay, should do so, but flexibilities will be in place for borrowers needing assistance.

Source: https://studentaid.gov/announcements-events/save-plan?utm_source=mcp&utm_medium=email&utm_campaign=camp_908

November 2022

Update on the Biden-Harris Administration’s Student Debt Relief Plan

September 2022

Update on the Biden-Harris Administration’s Student Debt Relief Plan

U.S. Department of Education sent this bulletin at 09/29/2022 11:31 AM EDT

Last month, President Biden announced his Administration's plan to provide student debt relief to eligible borrowers and give working and middle-class Americans more breathing room. You asked for updates on the Administration’s plan. This email contains additional information, and we will provide you weekly updates as more information becomes available.

Who's eligible

You are eligible if you have most federal loans (including Direct Loans and other loans held by the U.S. Department of Education) and your income for 2020 or 2021 is either:

• Less than $125,000 for individuals
• Less than $250,000 for households

If you are a dependent student, your eligibility is based on your parental income.

What you might be eligible for

• Up to $20,000 in debt relief if you received a Pell Grant in college
• Up to $10,000 in debt relief if you didn’t receive a Pell Grant

How it’ll work

• In October, the U.S. Department of Education will launch a short online application for student debt relief. You won’t need to upload any supporting documents or use your FSA ID to submit your application.
• Once you submit your application, we’ll review it, determine your eligibility for debt relief, and work with your loan servicer(s) to process your relief. We’ll contact you if we need any additional information from you.

What’s next

• Right now, you don’t need to do anything! We will contact you when the sign-up period for student debt relief opens.
• We will send you regular updates with more details over the coming days, as we near the application period, which will begin in October 2022 and last through December 2023.
• In the meantime, visit our Frequently Asked Questions page to find out more information on the student debt relief program.

Consolidation loans are also eligible for relief, as long as all of the underlying loans that were consolidated were ED-held loans and were disbursed on or before June 30, 2022. Additionally, consolidation loans comprised of any FFEL or Perkins loans not held by ED are also eligible, as long as the borrower applied for consolidation before Sept. 29, 2022.

As of Sept. 29, 2022, borrowers with federal student loans not held by ED cannot obtain one-time debt relief by consolidating those loans into Direct Loans.

Borrowers with FFEL Program loans and Perkins Loans not held by ED who have applied to consolidate into the Direct Loan program prior to Sept. 29, 2022, are eligible for one-time debt relief through the Direct Loan program.

ED is assessing whether there are alternative pathways to provide relief to borrowers with federal student loans not held by ED, including FFEL Program loans and Perkins Loans, and is discussing this with private lenders.

Beware of Scams

You might be contacted by a company saying they will help you get loan discharge, forgiveness, cancellation, or debt relief for a fee. You never have to pay for help with your federal student aid. Make sure you work only with the U.S. Department of Education and our loan servicers, and never reveal your personal information or account password to anyone.

Our emails to borrowers come from noreply@studentaid.gov, noreply@debtrelief.studentaid.gov or ed.gov@public.govdelivery.com. You can report scam attempts to the Federal Trade Commission by calling 1-877-382-4357 or visit reportfraud.ftc.gov.

The Health Resources and Service Administration’s (HRSA’s) Bureau of Health Workforce (BHW) would like to thank you and all those people involved in the success of the revolving loan program at your school.

HRSA understands and acknowledges the critical role you play as recipient institutions and the unexpected hardships you and your students have faced, during this uncertain period.

We continue to support students and institutions during this recovery period. HRSA has approved the extension of the temporary interest waiver and administrative forbearance for borrowers with loans made under the revolving loan programs to mirror the actions of the Department of Education through December 31, 2022. These policies apply to borrowers from the following programs:

• Health Professions Student Loan (HPSL);
• Primary Care Loan (PCL);
• Loans for Disadvantaged Students (LDS);
• Nursing Student Loan (NSL)

HRSA is providing this information to you as a recipient organization of one or more of these programs. If there are any additional changes and updates to our programs, they will be posted on our website.

If you use a third-party loan servicer, you should communicate this information to them. For more information about the extension, please visit HRSA’s webpage: HRSA BHW Student Loan Q and As.

August 2022

The Biden-Harris Administration's Student Debt Relief Plan Explained

The Biden-Harris Administration is working to quickly implement improvements to student loans. If you'd like to be the first to know, sign up for email updates from the U.S. Department of Education.

Detailed information on one time debt forgiveness eligibility

January 2022

FSA Announces Transfer Update on FedLoan Accounts

By Hugh T. Ferguson, NASFAA Staff Reporter

Federal Student Aid (FSA) in a recent updated notice announced that the student loan servicer MOHELA will be servicing certain types of loans previously administered by FedLoan (PHEAA), which elected to not extend its servicing contract and is currently in the process of exiting the federal student loan portfolio.

“We have also determined that MOHELA will be the future servicer for borrowers in the Public Service Loan Forgiveness (PSLF) Program” FSA wrote in an updated announcement published Dec. 22, 2021. “All borrowers enrolled in PSLF recipients will remain with FedLoan Servicing until they are transferred to MOHELA later in 2022.”

FSA also indicated that it would provide updates to this webpage in order to inform borrowers of impending details concerning loan transfers.

With the federal student loan payment pause now extended through May, the Department of Education (ED) has additional time to sort through administrative hurdles that could make resuming student loan repayment a bumpy process.