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Extension of Student Loan Repayment Bonus

One of the most common sources of financial aid is money talks student loans. While they are a great way to start your career and get your education, they can also be very expensive.

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Extension of Student Loan Repayment Bonus

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  1. Extension of Student Loan Repayment Bonus Thanks to the government of loan forgiveness up to $20,000, the student loan landscape has been transformed. The repayment freeze will be extended possibly until the middle of 2023. Pell grants can be used to cancel up to $20,000 of student loans. Pell grant recipients may still be eligible to receive up to $10,000 in forgiveness. Both cases require that the income of recipients during the pandemic be less than $125,000 per person and less than $250,000 per couple. Now is the time to apply.

  2. How to apply for student loan forgiveness? The application form for Money Talks Student Loan debt relief requires your name, Social Security number and date of birth. There is no documentation required. In some cases, however, a request might not be required. According to the Department of Education, "Nearly 8 Million Borrowers may be eligible for relief automatically because relevant income data already exists."

  3. Final Repayment Pause Extension All federally-held student loans were exempted from interest and their default status was lifted. The relief action stopped garnishment of wages and other income for defaulters. Eligible borrowers' "non payments” during the repayment freeze count towards requirements for forgiveness under income driven repayment (IDR), the Public Service Loan Forgiveness(PSLF), and loan rehabilitation agreements

  4. New repayment plan in the works Also, the government stated that it would be proposing an income-driven repayment plan with borrowers receiving even more favorable terms than the current system. The program will allow federal student loans to be forgiven completely in 10 years. This is a reduction of the current 20-25 year period (depending on which IDR plans you choose). It would also reduce the monthly minimum student loan payment to 5% from borrower's discretionary earnings -- from 10% currently -- as well as alter the definition for discretionary income to protect more borrowers' earnings. Perhaps the most important thing is that the loans are interest-free as long as the borrower pays their outstanding repayments. According to the Department of Education, this means that a borrower's debt balance won't grow despite current income-driven repayment plans.

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