Borrowers straddled with hefty medical expenses, childcare fees, and other fiscal challenges may qualify for assistance. (iStock)
The Biden-Harris regime recently submitted a new plan focused on aiding borrowers hobbled by expensive student loans. This phase of student debt relief aims to provide solace to students ensnared in severe financial difficulties.
The scheme suggests offering automatic assistance to borrowers seen at risk of defaulting on their loans within the upcoming two years.
“Higher education should pave way for a prosperous future, but many students find themselves knee-deep in trouble due to their student loan debt,” said Under Secretary James Kvaal.
“The measures we are proposing today can lend a hand to borrowers who are dealing with hardships in their lives, and they are a part of President Biden’s overall strategy to alleviate the hardship of as many student loan borrowers as possible.”
Biden’s proposal delineates the considerations that the U.S. Secretary of Education might take into account while adjudging if a borrower merits relief. These considerations incorporate the cumulative loan balance, associated monthly repayments, and the borrower’s income.
Other substantial requirements like childcare and healthcare expenses are also considered. Borrowers incurring high expenses beyond their control will likely get some assistance under Biden’s fresh initiative.
If you hold private student loans, regrettably this federal relief doesn’t cater to you. To diminish monthly repayments and lighten the load of student loan debt, contemplate refinancing your student loans. Leverage Credible, an online marketplace to equate varied interest rates.
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FAFSA glitches to be rectified soon
This year witnessed a relaunch of the Free Application for Federal Student Aid (FAFSA), but the process was fraught with hiccups. Students observed erroneous award amounts attributed to income miscalculations. Consequently, awards delay is anticipated, probably till March.
The U.S. Department of Education disclosed further steps to tackle these issues and quicken the processing of financial aid forms by colleges.
The rectifications involve downsizing the verification documents expected from students. In addition, routine program reviews will be deferred till June by the Education Department. These reviews usually scrutinized to check the adherence of colleges to fundamental financial and educational necessities.
Within 90 days of their Program Participation Agreement (PPA) expiry, colleges typically had to recertify for federal student aid schemes. This recertification requirement will be bypassed for institutions whose PPAs are due to expire in March, June, or September of this year.
Refinancing your loan into one with a more accessible interest rate can reduce your monthly student loan repayments. Check if refinancing suits you by utilizing Credible to juxtapose rates from diverse lenders simultaneously.
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Scammed student loan borrowers await compensations
More than 8000 student loan borrowers fell prey to a student debt relief fraudulent scheme from 2015 to 2020. These students are now looking for some genuine relief, according to the Consumer Finance Protection Bureau.
Performance SLC and Performance Settlement illegally charged approximately $9.2 million in upfront fees to borrowers instead of guiding them to free programs offered by the U.S. Department of Education.
Victimized borrowers who dealt with these firms will soon receive checks, redeeming them for the fees they had to shell out. The distribution of checks commenced from February 15th.
An accumulated amount of $10,936,618 is setup for distribution to the students, courtesy of the CFPB’s victims’ relief fund.
To steer clear of student loan debt relief scams, it’s imperative to diligently research about any company before dealing with them.
“Whenever an offer appears too attractive to be true, it probably isn’t,” stated John Haraburda, a robocall data expert at Transaction Network Services.
Prior to exploring debt relief alternatives, consider converting your student loans into a private loan with lower interest rates by refinancing. Visit Credible to evaluate student loan refinancing rates from an array of lenders without tarnishing your credit score.
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