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The U.S. Department of Education (DOE) recently revised its earlier guidance regarding borrower eligibility for student loan debt relief in hopes to stave off legal challenges.
As of September 29, 2022, those with federal student loans not held by the department will not be entitled to one-time debt relief by consolidating those loans into direct loans. This change could impact as many as 800,000 borrowers and even more borrowers could receive less relief than they were entitled to under the previous guidance.
According to the updated guidance, borrowers with Federal Family Education Loan Program loans or Perkins loans not held by the DOE who have applied to consolidate them into the Direct Loan Program prior to September 29, 2022, are eligible for debt relief through the Direct Loan Program. The DOE is looking into alternate pathways to provide relief to borrowers with federal student loans not held by them.
The DOE will soon release details on how borrowers can claim student loan relief. For now, borrowers can review the DOE’s FAQs, visit their website, and can sign up to receive email and text updates for the latest information. Concerned borrowers can contact their loan servicer to confirm whether they will be impacted by the DOE’s recent eligibility change. Download the bulletin for more details and stay tuned to our blog for the latest updates.
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