Get Overlapping Loan Clearance Form

Who qualifies for student loan forgiveness? To be eligible for forgiveness, you must have federal student loans and earn less than $125,000 annually (or $250,000 per household). Borrowers who meet that criteria can get up to $10,000 in debt cancellation.

Borrowers often wonder how the U.S. Department of Education spends the interest that borrowers pay on federal student loans in the Direct Loan program. Most of the money goes to cover the costs of making, servicing and collecting the student loans, as well as defaults, discharges and loan forgiveness.

The income limits are based on your adjusted gross income (AGI) in either the 2020 or 2021 tax year. People who earned less than $125,000 annually (or $250,000 if filing taxes jointly) are eligible. If you qualify in either of those years, you can get forgiveness.

Direct loans eligibility in the first loan period (overlapping loan period) is determined by subtracting the amount received in the prior loan period from the student maximum eligibility in the current loan period.

Borrowers do not need to reapply.

The National Student Loan Data System (NSLDS) indicates that you are in DEFAULT on one or more federal student loans . You are not eligible to receive any federal student aid until these items have been resolved. You may log into NSLDS to review your official loan history at .nslds.ed.gov.

The Supreme Court is expected to issue a final decision on the loan forgiveness plan by June 30. If the justices decide in favor, borrowers may start receiving student loan forgiveness within weeks. If the Court shuts down the program, relief goes out the window, and the Biden administration will be forced to reassess.

What student loans are not eligible for forgiveness? Private student loans, by definition, are private and are not eligible to be forgiven. These are loans the borrower owes to student loan providers and not the federal government.