Ministry of Education changes guidance on student loan relief

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Ministry of Education Amends Student Loan Relief Guidelines | EdSource






























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Up to 800,000 student borrowers may not get debt relief originally promised, after the Biden administration cut loans eligible for forgiveness, rewriting guidelines this week, NPR reported.

Initially, borrowers whose loans were held by private lenders but guaranteed by the government could consolidate loans into direct federal loans to qualify for the debt relief plan. This included federal loans for family education, which were common until the FFEL program ended in 2010.

But as of Thursday, according to NPR, the Department of Education “quietly changed that language.”

The guidelines now state, “Effective September 29, 2022, borrowers with federal student loans not held by ED cannot obtain one-time debt relief by consolidating these loans into direct loans.”

A spokesperson for the Ministry of Education said borrowers who applied to consolidate their loans into direct loans before September 29 will still be eligible for debt relief.

The changing guidelines come after a lawsuit was filed claiming debt forgiveness would hurt loan servicers, although the Department for Education did not say why the change was made.

President Joe Biden’s student debt relief plan, announced in August, would relieve up to $10,000 for borrowers with incomes of $125,000 or less, or up to $20,000 if the borrower was receiving a Pell grant while in college.


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