The Biden administration has begun rolling out a series of programs and initiatives to ease the burden of student loans and make the reimbursement process more fair and manageable. For those who hold student loans and want to take advantage of all the benefits to come, there are some key dates you might want to know about in 2023. With the multitude of new initiatives launching simultaneously, it can be overwhelming keeping track of deadlines. imminent and where action is needed. Here’s a roundup of important dates you’ll want to add to your calendar to make the most of student loan repayments and new programs.
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December 31, 2022
It is important for borrowers to be aware of December 31, 2022. Although this date is technically in 2022, it is still a key day to be aware of. It’s the last day the application will be open to apply for student loan debt relief. The Federal Student Loan Debt Relief Program will provide eligible borrowers with loan relief of up to $10,000 for those who are not Pell Grant recipients and up to $20,000 in debt relief. loan for those who were recipients of a Federal Pell Grant. Be sure to check out federal student aid website to find out if you are eligible for assistance.
Although you have until the end of December to submit your application, the Ministry of Education recommends applying before November 15, as it will take between four and six weeks for applications to be processed and for the money to arrive. borrower accounts.
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January 1, 2023
Borrowers are likely dreading January 1, 2023. On the first of the month, student loan repayments will resume after a long pause. With this impending repayment date, it is important that borrowers submit their applications as soon as possible so that they can be processed and their accounts updated before payments resume.
May 1, 2023
The new IDR account adjustment will begin in November 2022, with some people seeing their debts discharged or substantially repaid by then or later in July 2023. No further action is needed for this initiative for those who already have loans federal students for this program automatically occur throughout the fall. However, borrowers with FFEL and corporate-held student loans may require direct loan consolidation in order to receive relief. This must be done before May 1, 2023.
For those unfamiliar, this is another student loan relief initiative that Biden announced last spring that will launch income-contingent repayment (IDR) programs. Under this plan, the Ministry of Education will be able to provide retroactive credit to someone’s student loan account for the duration of a borrower’s repayment. The ministry said more than 3.6 million borrowers will get at least three years of repayment credit.
“Any borrower with loans that have accumulated a repayment time of at least 20 or 25 years will see automatic forgiveness, even if you are not currently on an IDR plan,” according to the department.
July 1, 2023
Beyond the temporary initiatives, the Biden administration is also implementing new regulations for federal student loans to bring about more lasting changes. These new plans include updating the Public Service Loan Forgiveness (PSLF) regulations to codify the limited PSLF waiver. The PSLF program allows borrowers to get credit for payments they have made on their loan that would not normally qualify for the PSLF.
There is also a discussion for the enactment of a more affordable IDR plan. In a statement from the Department of Education in August, the department is proposing a new income-focused repayment plan that would lower monthly payments for low- and middle-income borrowers. The new plan would reduce monthly payments on undergraduate loans by 50%. The proposed new plan would also help protect loans against accrued interest by reducing interest rates.
Although these regulations have not yet been finalized, they could be enacted on July 1, 2023 at the earliest.
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This article originally appeared on GOBankingRates.com: Repayment of student loans: 2023 dates to know now