President Biden has a ‘Plan B’ lined up for student loan forgiveness, which looks significantly different from the first plan.
His original plan, which was recently blocked by the U.S. Supreme Court, would have cancelled up to $20,000 in student loan debt for tens of millions of borrowers. Following the ruling, the President created a Student Loan Debt Relief Committee to create an alternate plan.
The President’s original plan impacted nearly 40 million American borrowers, but the new plan will be narrower in reach. The original, which covered more than 90 percent of federal student borrowers, will now cover just 10 percent.
Five specific groups of borrowers may be eligible for Biden’s most recent loan forgiveness plan. These groups include:
- Student loan borrowers carrying current balances greater than what they originally borrowed;
- Student loan borrowers who entered into repayment on their student loans 25 or more years ago;
- Borrowers who attended schools with programs of “questionable value,” many of which are “for-profit” institutions;
- Borrowers who are eligible for existing student loan relief programs, such as Public Service Loan Forgiveness, who just have not yet applied, and
- Debtors in financial hardship.
While President Biden’s first attempt at student loan forgiveness was going to be a faster effort, with the President promising borrowers the relief within six weeks after completing the paperwork, this new program is going through the rulemaking process and will take longer. Going through formal rulemaking can take up to a year, but if the administration is successful, borrowers could possibly see their student loan debt cancellation near the time of the presidential election.
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For borrowers who are struggling with student loan debt, relief options are available. Many student loan borrowers are unaware that they have rights and repayment options available to them, such as postponement of loan payments, reduction of payments or even a complete discharge of the debt. There are ways to file for bankruptcy with student loan debt. It is important you contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.
