What student loan borrowers in limbo by blocked student loan forgiveness plan should do
The Biden administration's student loan forgiveness plan is facing a series of legal challenges. As the courts weigh in, 40 million Americans who expected debt relief could start getting billed again in January. That's when a pandemic-era moratorium is set to expire.
Here's what borrowers should do right now:
- While federal loans are accruing zero interest, get a jump on any amounts above the forgiveness thresholds of $10,000 and $20,000, that is as long as you can afford to do so.
- You should also go to the website StudentAid.gov and make sure that you have enrolled in Auto-Debit, which will ensure that if the interest rate clock starts ticking again, you will not miss a payment.
- If your financial situation has changed, check out the Loan Simulator on StudentAid.gov to determine if a different repayment plan better meets your needs or if consolidation might help.
- Finally, if you've already applied for loan forgiveness, the Department of Education will hold your application. If you have not yet signed up, you will have to wait until the final verdicts are in.
