The first application process is now available for the federal student loan debt relief program that the government is offering.It was late August when President Joe Biden announced his plan to help cancel up to $20,000 in debt for low-to-middle-income borrowers, depending on their Pell Grant status.In the eyes of many college officials, the plan is a step in the right direction. “It’s not a solution to college affordability and issues that may ensure, in terms of federal student aid,” said Diane Corbett, Saint Michael’s Director of Student Financial Services. “But I think it’s really going to make great strides.”Greg Davis, Champlain College’s senior director of enrollment management and financial aid, shared that over 60% of Champlain students depend on federal relief programs such as this one. “It’s also going to change repayments, so it’s going to cap the repayments at 5% instead of 10% on income based repayment plans,” Davis said. “I think, in the long run, it will be beneficial to a lot more students.”However, just a little more than a month later, people are finding out the hard way that a change has been made in the eligibility process of who can receive this relief.Biden’s aid initially included borrowers who took out loans through the Federal Family Education Loan Program.However, that is no longer the case.Borrowers with that type of loan cannot obtain one-time debt relief by consolidating them into direct loans.According to the Vermont Student Assistance Corporation, this will impact 11,000 Vermonters and nationally affect roughly 4 million people, according to the U.S. Department of Education’s data.Vermont Student Assistance Corporation and the Vermont Congressional Delegation found out about the switch by scanning the frequently asked questions section and seeing a one-word change.The sentence went from “are eligible” to “are not eligible.” “We believe it was a bad decision that the administration made. Suddenly, they reversed themselves and caught everybody by surprise,” Giles said.” If you’re one of these borrowers. it’s a significant disappointment when you thought you had been promised something that has now been taken away.”Vermont Student Assistance Corporation officials say they’re speaking with the U.S. Department of Education to persuade them to return to their prior policies. They also shared that just because someone is not eligible for the relief program, they should still look into the Public Service Loan Forgiveness program.To be eligible for that program, an individual has to be working for a nonprofit group or the government. If qualified, they could potentially have 100% of their debt canceled.
The first application process is now available for the federal student loan debt relief program that the government is offering.
It was late August when President Joe Biden announced his plan to help cancel up to $20,000 in debt for low-to-middle-income borrowers, depending on their Pell Grant status.
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In the eyes of many college officials, the plan is a step in the right direction.
“It’s not a solution to college affordability and issues that may ensure, in terms of federal student aid,” said Diane Corbett, Saint Michael’s Director of Student Financial Services. “But I think it’s really going to make great strides.”
Greg Davis, Champlain College’s senior director of enrollment management and financial aid, shared that over 60% of Champlain students depend on federal relief programs such as this one.
“It’s also going to change repayments, so it’s going to cap the repayments at 5% instead of 10% on income based repayment plans,” Davis said. “I think, in the long run, it will be beneficial to a lot more students.”
However, just a little more than a month later, people are finding out the hard way that a change has been made in the eligibility process of who can receive this relief.
Biden’s aid initially included borrowers who took out loans through the Federal Family Education Loan Program.
However, that is no longer the case.
Borrowers with that type of loan cannot obtain one-time debt relief by consolidating them into direct loans.
According to the Vermont Student Assistance Corporation, this will impact 11,000 Vermonters and nationally affect roughly 4 million people, according to the U.S. Department of Education’s data.
Vermont Student Assistance Corporation and the Vermont Congressional Delegation found out about the switch by scanning the frequently asked questions section and seeing a one-word change.
The sentence went from “are eligible” to “are not eligible.”
“We believe it was a bad decision that the administration made. Suddenly, they reversed themselves and caught everybody by surprise,” Giles said.” If you’re one of these borrowers. it’s a significant disappointment when you thought you had been promised something that has now been taken away.”
Vermont Student Assistance Corporation officials say they’re speaking with the U.S. Department of Education to persuade them to return to their prior policies.
They also shared that just because someone is not eligible for the relief program, they should still look into the Public Service Loan Forgiveness program.
To be eligible for that program, an individual has to be working for a nonprofit group or the government. If qualified, they could potentially have 100% of their debt canceled.
