Details of President Biden’s New Student Loan Forgiveness Program; Announces Final Extension to Student Loan Repayment Program

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Millions of Americans have waited eagerly over these past two and a half years for student loan forgiveness.

This week, President Biden issued the first of his student loan forgiveness plans. For those earning less than $125,000 a year—or couples with incomes under $250,000--up to $10,000 in federal student loan debt will be forgiven. If individuals used Pell grants to attend college (which are reserved for students with greatest financial need), up to $20,000 in federal student loan debt will be forgiven.  

President Biden also this week officially extended the “student loan payment pause” until December 31st, 2022. Interest rates will remain at 0% until repayments start in January 2023. Biden states that this will be the last extension for student loan payments.

 Mandatory student loan payments as well as interest accrual have been “on pause” since March 13, 2020, the beginning of the pandemic. 98.8% of borrowers did not make payments during this time period but those who did can receive refunds for their payments by calling their loan servicers directly. About 37 million student loan borrowers skipped nearly $200 million in payments during the pause, according to the Federal Reserve Bank of New York.

Immediately after President Biden’s announcement, Consumer Credit Counseling Service (CCCS) encouraged area residents to contact them at 716-712-2060 or www.consumercreditbuffalo.org for help with student loans or for any type of financial issues.  With just about 70% of college graduates leaving school with student loan debt, it is certain that student loans will continue to be part of the landscape for much of the WNY community. Last year, the average per person debt was $35,397 and the typical monthly payment--$393 per month. At current time, nearly 2.4 million New Yorkers have outstanding student loans totaling more than $90 billion combined.

 CCCS operates the only Student Loan Counseling Program in all of Western New York and designed its program to specifically meet the needs of the growing population segment of student loan borrowers. CCCS Certified Financial Counselors understand that many of those coming for help feel overwhelmed with anxiety and fear and often see individuals who have fallen prey to the abundance of unscrupulous companies claiming to help. CCCS urges everyone to take positive action that will promote financial stability: For those interested in any type of help--call 716-712-2060 or visit www.consumercreditbuffalo.org  

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