July 2023 Student Loan Update!

On Friday, July 14th, the Department of Education announced that it was sending notice to 804,000 borrowers who had spent 20 to 25 years in repayment on their federal student loans that their remaining balance would be canceled. The Income-Driven Repayment (IDR) programs allow borrowers to make payments based on their income and forgive any remaining balances after borrowers accrue 20 or 25 years of qualifying time in repayment. Under the IDR Account Adjustment, the Department is putting millions of borrowers closer to being debt free after 20 to 25 years in repayment by counting more past time—including all time in repayment and some periods of time in forbearance and deferments—towards IDR forgiveness. The Department adjusted the accounts of borrowers who had reached or exceeded the number of qualifying months toward forgiveness first; however, the Department will continue adjusting all borrowers’ accounts until 2024. Borrowers who are not yet at cancellation will see an adjustment to their accounts next year that will reflect their updated number of qualifying months toward cancellation of any remaining balance. For more information on what to do if you think you are eligible for cancellation or on how to opt-out, visit the Student Loan Borrower Assistance website.

‎ ‎ ‎

---