(NEXSTAR) – Millions of Americans will soon have some or all of their federal student loan debt forgiven following a Wednesday announcement by the Biden administration. But one big question remains: how will you receive your loan forgiveness if you qualify?
While the White House says 43 million borrowers can expect to receive relief – roughly 20 million of those are expected to have their remaining federal student loan balance completely erased – it’s not exactly clear how borrowers will apply for the forgiveness.
According to the U.S. Department of Education, nearly 8 million borrowers may qualify for relief automatically based on the income data the department already has.
If the Education Department doesn’t have your income data, or you’re unsure if the agency has it, there isn’t much to do right now.
Instead, you’ll need to wait for the Biden administration to launch an application process, which will be available “in the coming weeks.” The application will be available before the student loan repayment pause ends on December 31.
You can register to be notified when the application is available through the Department of Education by filling out this form.
On Wednesday, President Biden announced “targeted student debt cancellation” to help “borrowers at highest risk of delinquencies or default once payments resume.”
Forgiveness is restricted based on income. Borrowers “with annual income during the pandemic of under $125,000 (for individuals) or under $250,000 (for married couples or heads of households)” will be eligible for up to $10,000 in relief, according to the Department of Education.
Borrowers under the same income caps who received a Pell Grant in college will be eligible for up to $20,000 in debt cancellation. Not sure if you have a Pell Grant? Here’s how to find out.
In addition to student loan forgiveness, the Biden administration extended the payment pause on loans until the end of 2022, proposed a new rule to change to create a new income-driven repayment plan that will substantially reduce future monthly payments for lower- and middle-income borrowers, and proposed long-term changes to the Public Service Loan Forgiveness program.