Student loan forgiveness process will be ‘easy,’ says White House as it releases sample application
On Tuesday, Biden administration officials previewed the Department of Education’s highly-anticipated student loan forgiveness application process, which they said would be “easy,” “simple” and resistance to corruption. fraud.
But officials did not say when loan cancellation applications would be available online, beyond saying it would be in October. This is a delay from an earlier schedule that the forms would be released in early October.
In a call with reporters arranged by the White House, senior administration officials said they expected it to take “a couple of weeks” after someone asked them to get relief. loan forgiveness.
Still, officials reiterated that eligible borrowers must apply by mid-November to ensure their loan amount is forgiven before repayments resume on January 1, 2023, after a nearly three-year pause for the COVID-19 pandemic.
“We hope and plan to provide student debt relief to millions of Americans before loan repayments restart,” an official said on the call.
The government has urged people to double-check their details online to ensure they receive timely updates when the application is ready.
Under the discount plan, people who earned less than $125,000 in the 2020 or 2021 tax year — or less than $250,000 as a couple — will be eligible to set aside up to $10,000. federal student loan debt or up to $20,000 for people with Pell Grants, for low-income families.
The program, which President Joe Biden announced in August, is expected to apply to 43 million Americans — and 20 million could see their debt wiped out completely, the White House estimates.
Debt cancellation, which is also being challenged in court, is expected to cost about $400 billion, the Congressional Budget Office said, though the administration disputes that assessment.
On Tuesday, administration officials said that once the application is released, eligible borrowers will fill out a “simple” two-part form that will be available in English and Spanish, via computers and mobile devices, and accessible to disabled borrowers. The White House has also released a sample version of this form.
Borrowers won’t need to log in with a pre-existing help ID or upload documents to the link, officials said. They will need to provide their first and last names, social security number, date of birth, phone number, email address, and income based on their 2020 or 2021 taxes.
At the bottom of the form, borrowers must review and sign a certification statement under penalty of perjury, which administration officials said was part of their defense against fraud.
“This is a multi-step process to prevent fraud,” an administration official said, adding that “all borrowers who apply will be required to certify under penalty of perjury, which is subject to steep fines and prison terms, that they meet the income threshold.
Officials said there were “strict fraud prevention measures in place” for the loan forgiveness, but declined to detail them all.
A borrower will not have to mark whether or not they received a Pell grant, officials said. The DOE already has information on borrowers’ loans.
According to the White House, applicants who have a federal loan and are likely to “exceed” the income threshold will be required to submit additional information to confirm they meet the income requirement. The government will contact borrowers directly in cases where they need more information.
Officials told reporters that steps had been taken to ensure the government could meet the expected volume of demand for loan forgiveness.
“We have worked very hard with our existing contractors to ensure they have the capacity to serve the public,” an official said. “We have also provided additional support for web traffic and web volume, so we are aware of the scale of this project we are working on and its importance to 40 million borrowers, their families and their communities. and excitement there is going to be.”
Asked about the recent decision to scale back parts of the loan forgiveness program — particularly regarding Perkins Loans and the Federal Family Education Loan (FFEL), which are run by private banks — an official from the administration on the appeal did not dispute that the change was created to help protect the global policy from pending lawsuits.
“Our guiding principle here is that we try to reach as many borrowers as possible and do it as quickly and easily as possible,” the official said.
The official said the government was assessing other options for Perkins and FFEL loan borrowers.
The loan forgiveness application will be available until December 2023.
ABC News’ Cheyenne Haslett contributed to this report.