Education Department , Now Excluding Some Borrowers , From Student Debt Relief.
The United States Department of Education has released new
guidelines that prevent certain federal student loan borrowers
from qualifying for the student loan forgiveness program.
NBC reports that the update to the Education Department's guidance for one-time student debt relief is a complete reversal of previous guidelines.
Previously, the department said that borrowers whose loans were not held by the Department of Education could consolidate their debt into Direct Loans in order to qualify.
According to an administration official,
the number of borrowers affected
by this decision is about 770,000.
In August, President Joe Biden announced a sweeping
student loan forgiveness program that included
up to $10,000 for federal student loan borrowers.
There are an estimated 5 million "overlooked borrowers"
with commercially-held Federal Family Education Loan Program
(FFEL) loans who have been excluded from debt forgiveness.
Those with FFEL loans were also excluded
from the federal student loan payment pause
that was in effect throughout the COVID pandemic.
On September 29, news of the policy change was met with fierce criticism from borrowers and student loan experts on social media.
According to the Department of Education's website, work
is under way to determine if an alternative pathway to debt
relief can be found for those with FFEL Program loans