Student loan forgiveness: 3.5 million Californians qualify, find out if you're eligible
Student Loan Forgiveness
More than 40 million Americans have federal student loans. Most of these borrowers, about 37 million will be eligible for President Biden’s forgiveness plan as long as they meet the income limitations. Financial Advisor Winnie Sun answered questions about what it means for parents who took out loans themselves.
California will receive the most relief in the nation from President Biden’s student loan forgiveness plan. According to a White House analysis released on Tuesday, 3.5 million California residents are eligible to benefit from Biden's trillion-dollar loan relief plan.
Behind California is Texas, which has 3.3 million residents eligible to benefit from student loan forgiveness, followed by 2.4 million residents in Florida and 2.3 million in New York. The states with the fewest eligible borrowers include North Dakota, with 82,000; Vermont, with 72,200; and Wyoming, with 49,600.
Biden's student loan forgiveness plan is expected to provide up to $20,000 in debt relief to Pell Grant recipients and up to $10,000 to other borrowers. The Biden-Harris Administration expects that over 40 million borrowers are eligible for its student debt relief plan, and nearly 20 million borrowers could see their entire remaining balance discharged.
Nearly 90% of relief dollars will go to those earning less than $75,000 per year – and no relief will go to any individual or household in the top 5% of incomes in the United States.
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In addition to the 3.5 million California borrowers eligible for student debt relief are roughly 2.3 million Pell Grant borrowers eligible for relief.
Am I eligible for student loan relief?
You're eligible for student loan debt relief if your annual federal income was below $125,000 (individual or married, filing separately) or $250,000 (married, filing jointly or head of household) in 2021 or 2020.
- $20,000 in debt relief: If you received a Pell Grant in college and meet the income threshold, you'll be eligible for up to $20,000 in debt relief.
- $10,000 in debt relief: If you did not receive a Pell Grant in college and meet the income threshold, you'll be eligible for up to $10,000 in debt relief.
In the coming weeks, the Department of Education will release additional details on how individuals across the country can benefit from the Administration’s student debt relief plan. The application will be available online by early October 2022. You'll have until Dec. 31, 2023 to apply.