Just cancel student debt already

[Poeticxpassion]

Biden believes his plan is responsible and fair.

[wildrice]

Aug 24, 2022 12:43:52 GMT -5 pixy0stix said:

Aug 24, 2022 12:00:41 GMT -5 karinothing said:

Can they legally extend it to private loans? I think they would have to give cash to the private industry to forgive it? Or something. I don't know how that would work. 

I wonder what the loans were for the shady for profit colleges that were forgiven. Were they federal or private? I mention that because I wonder if the government has forgiven private loans before.

I was under the impression they were all federal loans. The government has no control over private loans so they don't have the ability to forgive. They could maybe do a tax credit or something but i don't think they usually just write checks to pay off private debt (unless you are a corporation, lol)

[Poeticxpassion]

He answered one question about the raid at mar a Lago and if he had advanced notice. He said none, zero.

[okla]

Aug 24, 2022 14:04:32 GMT -5 wildrice said:

Aug 24, 2022 12:39:01 GMT -5 bimbi284 said:

One thing to note - looks like this $10k/$20k won’t necessarily be automatically implemented to those this applies to. Based on this, there will be an application process launched sometime before Dec 31st.

“The Department will be announcing further details on how borrowers can claim this relief in the weeks ahead. The application will be available no later than when the pause on federal student loan repayments terminates at the end of the year. .Nearly 8 million borrowers may be eligible to receive relief automatically because relevant income data is already available to the Department.”

Definitely annoyed that they’ve added additional hoops here, but not surprised. Hopefully it’s streamlined and won’t require much from people who this applies to.

Yeah, especially if interest starts accruing again in January. I imagine most applications won't be processed in time to avoid paying some interest on that 10k. Maybe it will somehow be refunded, idk.

I am glad they are giving more to Pell grant recipients, though with the haphazard tracking that has gone on I have no idea how they will accomplish this. After consolidating and transferring servicers multiple times, are they even going to be able to identify who had Pell grants years ago?

I’ve had multiple servicers on my loans, and have consolidated twice. My Pell grant is still on the front page of my studentaid.gov dashboard, 18 years after it was awarded. It’s totally separate from the loans.

[seeyalater52]

I’m so bad with the student loan details. My wife’s federal loans are FFEL (Federal Family Education Loan) and serviced by Navient. As far as I can tell they haven’t been included in the pandemic student loan repayment pause so we have been paying them and they’re still due every month.

But it sounds like they’re going to be included in the $10/20k cancelation? Am I misunderstanding something?

I’m mostly just annoyed that we have to keep paying them until whatever point the cancellation actually happens (if it happens) bc the cancelation will wipe out the balance and then some.

While I recognize this is totally privileged we have gotten screwed every way to Sunday on wife’s loan situation to date so I’m extra salty about it.

[karinothing]

Aug 24, 2022 12:43:52 GMT -5 pixy0stix said:

Aug 24, 2022 12:00:41 GMT -5 karinothing said:

Can they legally extend it to private loans? I think they would have to give cash to the private industry to forgive it? Or something. I don't know how that would work. 

I wonder what the loans were for the shady for profit colleges that were forgiven. Were they federal or private? I mention that because I wonder if the government has forgiven private loans before.

I looked it up, seems like it was federal loans. I don't think the fed gov can force private institutions to forgive loans. They could give cash vouchers to folks to pay off private loans but I am assuming there are accounting differences btwn wiping our fed loans and giving folks cash.

[pixy0stix]

Aug 24, 2022 16:24:35 GMT -5 karinothing said:

Aug 24, 2022 12:43:52 GMT -5 pixy0stix said:

I wonder what the loans were for the shady for profit colleges that were forgiven. Were they federal or private? I mention that because I wonder if the government has forgiven private loans before.

I looked it up, seems like it was federal loans. I don't think the fed gov can force private institutions to forgive loans. They could give cash vouchers to folks to pay off private loans but I am assuming there are accounting differences btwn wiping our fed loans and giving folks cash.

Thanks for doing the legwork!

[okla]

Aug 24, 2022 16:16:45 GMT -5 seeyalater52 said:

I’m so bad with the student loan details. My wife’s federal loans are FFEL (Federal Family Education Loan) and serviced by Navient. As far as I can tell they haven’t been included in the pandemic student loan repayment pause so we have been paying them and they’re still due every month.

But it sounds like they’re going to be included in the $10/20k cancelation? Am I misunderstanding something?

I’m mostly just annoyed that we have to keep paying them until whatever point the cancellation actually happens (if it happens) bc the cancelation will wipe out the balance and then some.

While I recognize this is totally privileged we have gotten screwed every way to Sunday on wife’s loan situation to date so I’m extra salty about it.

I don’t know your exact situation, but even outside of PSLF you should be able to consolidate those loans to Direct and take advantage of the pause through December.

FFEL loans are still federal, but they aren’t usually serviced by the federal government, which is why they aren’t included in the pause. Consolidating to Direct will move them to be serviced by the feds and therefore eligible for COVID pause.

[seeyalater52]

Aug 24, 2022 16:29:49 GMT -5 okla said:

Aug 24, 2022 16:16:45 GMT -5 seeyalater52 said:

I’m so bad with the student loan details. My wife’s federal loans are FFEL (Federal Family Education Loan) and serviced by Navient. As far as I can tell they haven’t been included in the pandemic student loan repayment pause so we have been paying them and they’re still due every month.

But it sounds like they’re going to be included in the $10/20k cancelation? Am I misunderstanding something?

I’m mostly just annoyed that we have to keep paying them until whatever point the cancellation actually happens (if it happens) bc the cancelation will wipe out the balance and then some.

While I recognize this is totally privileged we have gotten screwed every way to Sunday on wife’s loan situation to date so I’m extra salty about it.

I don’t know your exact situation, but even outside of PSLF you should be able to consolidate those loans to Direct and take advantage of the pause through December.

FFEL loans are still federal, but they aren’t usually serviced by the federal government, which is why they aren’t included in the pause. Consolidating to Direct will move them to be serviced by the feds and therefore eligible for COVID pause.

That’s fair. We have avoided consolidating them bc it’s kind of a headache for what is a fairly low balance loan right now and before the announcement today we were planning to repay them during the pause anyways. If anyone who has consolidated loans can advise about how much of a pain in the ass it is to do just for this brief interlude that would be awesome.

Now I’m doubting some of the reporting that included FFEL loans in the cancelation though. The official announcement says “federally held loans.” Ugh. Maybe we should consolidate them anyways in that case.

ETA: of course the announcement today has totally broken the SA website. Fun times.

[plutosmoon]

I am a member of NASFAA (aid admin org), and they released a message on this they believe and I agree as an aid professional this is an incomplete solution without coupling it with loan reform. I've been in the financial aid field long enough to see all sorts of crazy interest rates, including my own loans at 8.25% in 2000 or 2001, there is no need for student loan interests rates to be as high as they are. If the government insists on having an interest rate it should be very low and make all loans subsidized. The info I have seen is light on details, this applies only to students currently in repayment, is it a one time deal? What if a student only borrowed $5k so far for an AA, but is waiting to finish their degree, will they get 5k now and another 5k later? What about the class of 2023 and beyond? I think they could have done a lot better. I know reforming the actual loan program might require congress, but at least couple this with a loan reform proposal. I continue to be disappointed by our federal government's lack of consideration for higher ed funding.

seeyalater52, Early in my aid career I consolidated federal loans for a living, even back then the process was pretty easy, you should be able to do it all online through studentaid.gov. Just don't try it today, studentaid.gov is overloaded. If she doesn't have an fsa id to log into the studentaid website, sometimes that can be a bit of a pain. I'd consolidate.

[seeyalater52]

Aug 24, 2022 9:42:17 GMT -5 heygrey said:

Aug 24, 2022 1:52:06 GMT -5 ellipses84 said:

I’m very curious to see what the terms will be. I was lucky to benefit from PSLF forgiveness for the majority of my loans since they were in my mom’s name and she’s an educator. However, I have a few thousand left in my name and it dawned on me recently that they may need to be consolidated to qualify for any forgiveness. They are FFEL loans which didn’t qualify for the payment pause under the cares act and I’ve been paying on them the whole time. I really should have looked into this sooner so I could have benefited from that too, but the were such a drop in the bucket compared to the rest. Fingers crossed for everyone!

My only fed loans are FFEL serviced by Navient so I've been paying on them as well. 

I posted a thread about this in July and the general advice was to consolidate them with Fed Loan so they would qualify for forgiveness if there was any. Life kind of hit the fan for a few weeks and I didn't get it done. I hope they either remember to include FFEL loans (unlikely) or give us a grace period to transfer them over. It's "only" $6500 for me, but if that much could just disappear it would be a huge weight off. I'll still have a bit left in private loans. 

I missed this post when I was trying to find the most recent active portion of the thread. Yes this is the situation we are in too. We are going to bite the bullet and consolidate now but I’m worried it is too late and of course you can’t get it started today bc the site is overloaded from the announcement. The FFEL group gets consistently screwed it is so bizarre.

[seeyalater52]

Thanks plutosmoon. Neither of us seems to be able to access our SA accounts (when the whole thing isn’t offline from the increased traffic, that is) so that is definitely a hurdle too. This is all just incredibly frustrating.

[was5]

Aug 24, 2022 17:05:17 GMT -5 seeyalater52 said:

Aug 24, 2022 9:42:17 GMT -5 heygrey said:

My only fed loans are FFEL serviced by Navient so I've been paying on them as well. 

I posted a thread about this in July and the general advice was to consolidate them with Fed Loan so they would qualify for forgiveness if there was any. Life kind of hit the fan for a few weeks and I didn't get it done. I hope they either remember to include FFEL loans (unlikely) or give us a grace period to transfer them over. It's "only" $6500 for me, but if that much could just disappear it would be a huge weight off. I'll still have a bit left in private loans. 

I missed this post when I was trying to find the most recent active portion of the thread. Yes this is the situation we are in too. We are going to bite the bullet and consolidate now but I’m worried it is too late and of course you can’t get it started today bc the site is overloaded from the announcement. The FFEL group gets consistently screwed it is so bizarre.

I think this is the situation I'm in. My loans were originally through my schools, but I consolidated my undergraduate and grad school loans with Sallie Mae (now Navient) around 2006 but it's still technically 2 differentloans I think. I've had no relief and have had to continue making monthly payments. I had no idea it was possible to consolidate now and make them federal loans. Thanks for asking the question! Fingers crossed.

[seeyalater52]

Aug 24, 2022 17:18:50 GMT -5 was5 said:

Aug 24, 2022 17:05:17 GMT -5 seeyalater52 said:

I missed this post when I was trying to find the most recent active portion of the thread. Yes this is the situation we are in too. We are going to bite the bullet and consolidate now but I’m worried it is too late and of course you can’t get it started today bc the site is overloaded from the announcement. The FFEL group gets consistently screwed it is so bizarre.

I think this is the situation I'm in. My loans were originally through my schools, but I consolidated my undergraduate and grad school loans with Sallie Mae (now Navient) around 2006 but it's still technically 2 differentloans I think. I've had no relief and have had to continue making monthly payments. I had no idea it was possible to consolidate now and make them federal loans. Thanks for asking the question! Fingers crossed.

Just a word of caution because I don’t know your exact situation, but not all loans held by private servicers are eligible to be consolidated back to the federal government. The specific program my wife’s loans are in were originated as federal loans and then bought by a private servicer (we never consolidated or did anything to bring them into the private servicer) which is why I think they’re eligible for this type of consolidation. I’m not sure about other circumstances and who is eligible.

[seeyalater52]

Aug 24, 2022 17:30:27 GMT -5 mofongo said:

Aug 24, 2022 16:52:00 GMT -5 seeyalater52 said:

That’s fair. We have avoided consolidating them bc it’s kind of a headache for what is a fairly low balance loan right now and before the announcement today we were planning to repay them during the pause anyways. If anyone who has consolidated loans can advise about how much of a pain in the ass it is to do just for this brief interlude that would be awesome.

Now I’m doubting some of the reporting that included FFEL loans in the cancelation though. The official announcement says “federally held loans.” Ugh. Maybe we should consolidate them anyways in that case.

ETA: of course the announcement today has totally broken the SA website. Fun times.

I am NO expert, like not even a little. But H had FFEL loans (pretty sure). His were with Naviant, we did the consolidation and application for PSLF, they were then moved to FedLoan and eventually forgiven. Up until we did the consolidation and PSLF application we were paying. I’d say we started the process in Oct/Nov 2021? They were paid in Aprilish of this year. Once we applied and all, his payments were deferred. GL!

Thank you! Neither of us qualifies for PSLF even with the waiver so there hasn’t been a real benefit to consolidating until now but I think we are going to go for it and hope that they are included in cancelation.

[wanderingback]

Aug 24, 2022 14:01:38 GMT -5 Poeticxpassion said:

He hasn't specified if it's $125k single and $250k married or not?

Income repayment plan goes from 10% of income to 5% of income,

Only for undergraduate loans re: income plan, not graduate.

[okla]

Aug 24, 2022 17:32:33 GMT -5 seeyalater52 said:

Aug 24, 2022 17:30:27 GMT -5 mofongo said:

I am NO expert, like not even a little. But H had FFEL loans (pretty sure). His were with Naviant, we did the consolidation and application for PSLF, they were then moved to FedLoan and eventually forgiven. Up until we did the consolidation and PSLF application we were paying. I’d say we started the process in Oct/Nov 2021? They were paid in Aprilish of this year. Once we applied and all, his payments were deferred. GL!

Thank you! Neither of us qualifies for PSLF even with the waiver so there hasn’t been a real benefit to consolidating until now but I think we are going to go for it and hope that they are included in cancelation.

I consolidated from FFEL to Direct in January for PSLF purposes and it was quick and easy through studentaid.gov. Took less than a month for completion. I had the rare FFEL loans that were eligible for the COVID pause, though.

[isabel]

Aug 24, 2022 13:04:58 GMT -5 pixy0stix said:

Aug 24, 2022 13:00:42 GMT -5 seeyalater52 said:

For what it’s worth, while the plan is light on the details I do think they would have specified if it was limited to undergrad only bc otherwise people would be big mad if they were led to believe this was happening and then weren’t eligible. Enough people are mad about this for various reasons already, they don’t need to fuel the fire.

But they’re not always smart about this stuff so who knows.

Whew, the comments on the articles (I KNOW I KNOW) are extra salty. 

I feel somewhat salty because we paid off all of dh's loans before any of this started. Don't get me wrong, I'm happy for everyone. Truly. Forgiving loans is beneficial for everyone. But also, a small bit of me is asking where mine is?

Yeah… I paid off all my federal loans. DH’s are consolidated through Sofi. So I’m assuming we’re SOL which is pretty frustrating given I had over $10k in federal loans that presumably would have been covered.

I’m pretty good about being happy for others when stuff like this happens, but this one is getting me a bit.

[pixy0stix]

My FB is a bit like this right now. 



Whew. No one is completely happy with this it seems. 

[wanderingback]

A financial planner just posted on Twitter that $10,000 is about 161 days of interest on $350,000 of graduate student loan. So if I had qualified it seems it would have knocked off about 1/2 a years interest (although I think my loans are somewhat about $350,000). Interesting perspective!

I also think it’s interesting how Biden’s tweet emphasized that this is to help middle and working class families. It’s like he threw that in to appease republicans specifically?

[jackie011]

Is this where I wish I had a time machine to go back and stop my federal employee husband from consolidating his loans back in the day 😤

Happy for everyone who benefits from this!!

[gretchenindisguise]

Aug 24, 2022 20:02:44 GMT -5 jackie011 said:

Is this where I wish I had a time machine to go back and stop my federal employee husband from consolidating his loans back in the day 😤

Happy for everyone who benefits from this!!

Did he consolidate or refinance? If he only consolidated, he should still be ok.

[wanderingback]

Aug 24, 2022 20:02:44 GMT -5 jackie011 said:

Is this where I wish I had a time machine to go back and stop my federal employee husband from consolidating his loans back in the day 😤

Happy for everyone who benefits from this!!

I think consolidating is what you’re supposed to do to qualify for pslf.
Do you mean he refinanced to a private lender?
If he consolidated then that could likely be a good thing.

[seeyalater52]

Aug 24, 2022 19:41:29 GMT -5 wanderingback said:

A financial planner just posted on Twitter that $10,000 is about 161 days of interest on $350,000 of graduate student loan. So if I had qualified it seems it would have knocked off about 1/2 a years interest (although I think my loans are somewhat about $350,000). Interesting perspective!

I also think it’s interesting how Biden’s tweet emphasized that this is to help middle and working class families. It’s like he threw that in to appease republicans specifically?

I saw that and felt immediately ill on your behalf. What a horrifying way to put it in perspective.

[gretchenindisguise]

Aug 24, 2022 17:18:50 GMT -5 was5 said:

Aug 24, 2022 17:05:17 GMT -5 seeyalater52 said:

I missed this post when I was trying to find the most recent active portion of the thread. Yes this is the situation we are in too. We are going to bite the bullet and consolidate now but I’m worried it is too late and of course you can’t get it started today bc the site is overloaded from the announcement. The FFEL group gets consistently screwed it is so bizarre.

I think this is the situation I'm in. My loans were originally through my schools, but I consolidated my undergraduate and grad school loans with Sallie Mae (now Navient) around 2006 but it's still technically 2 differentloans I think. I've had no relief and have had to continue making monthly payments. I had no idea it was possible to consolidate now and make them federal loans. Thanks for asking the question! Fingers crossed.

Check on studentaid.gov If your loans show up there they are federal loans. My guess is you have consolidated ffel loans and those are eligible to be consolidated to direct loans to benefit from either pslf or this new relief. Pre-2014, Sallie Mae did federal loans too.

[wildrice]

Aug 24, 2022 18:21:26 GMT -5 isabel said:

Aug 24, 2022 13:04:58 GMT -5 pixy0stix said:

Whew, the comments on the articles (I KNOW I KNOW) are extra salty. 

I feel somewhat salty because we paid off all of dh's loans before any of this started. Don't get me wrong, I'm happy for everyone. Truly. Forgiving loans is beneficial for everyone. But also, a small bit of me is asking where mine is?

Yeah… I paid off all my federal loans. DH’s are consolidated through Sofi. So I’m assuming we’re SOL which is pretty frustrating given I had over $10k in federal loans that presumably would have been covered.

I’m pretty good about being happy for others when stuff like this happens, but this one is getting me a bit.

Feelings are feelings, but I struggle with this sentiment a bit (and it's not really aimed at you isabel, more at the internet). If you are in your mid thirties and have paid off your loans, you likely either a) had a low balance to begin with b) had a high paying job or other financial support/windfall that allowed you to pay them off. Forgiveness is really aimed at the people who are drowning under their loans and won't have a reasonable pathway to getting out from under them anytime soon. 10k in loans for someone making minimum or close to minimum wage is a long term burden. High loan balances with high interest rates are a huge burden for middle and even upper middle incomes.

My household benefits from this and I got PSLF earlier this year. But between us we've paid off over 50k in loans by paying on them, and we'll still have almost 90k to pay off on my H's loans (really much more than that with future interest). So I don't think anyone should be jealous of us, lol.

[jackie011]

Aug 24, 2022 20:05:58 GMT -5 wanderingback said:

Aug 24, 2022 20:02:44 GMT -5 jackie011 said:

Is this where I wish I had a time machine to go back and stop my federal employee husband from consolidating his loans back in the day 😤

Happy for everyone who benefits from this!!

I think consolidating is what you’re supposed to do to qualify for pslf.
Do you mean he refinanced to a private lender?
If he consolidated then that could likely be a good thing.

Oops, refinancing. His loans are now private

[pixy0stix]

Aug 24, 2022 20:19:17 GMT -5 wildrice said:

Aug 24, 2022 18:21:26 GMT -5 isabel said:

Yeah… I paid off all my federal loans. DH’s are consolidated through Sofi. So I’m assuming we’re SOL which is pretty frustrating given I had over $10k in federal loans that presumably would have been covered.

I’m pretty good about being happy for others when stuff like this happens, but this one is getting me a bit.

Feelings are feelings, but I struggle with this sentiment a bit (and it's not really aimed at you isabel, more at the internet). If you are in your mid thirties and have paid off your loans, you likely either a) had a low balance to begin with b) had a high paying job or other financial support/windfall that allowed you to pay them off. Forgiveness is really aimed at the people who are drowning under their loans and won't have a reasonable pathway to getting out from under them anytime soon. 10k in loans for someone making minimum or close to minimum wage is a long term burden. High loan balances with high interest rates are a huge burden for middle and even upper middle incomes.

My household benefits from this and I got PSLF earlier this year. But between us we've paid off over 50k in loans by paying on them, and we'll still have almost 90k to pay off on my H's loans (really much more than that with future interest). So I don't think anyone should be jealous of us, lol.

Try mid-40s, slew of low paying jobs and a career public servant, but thanks for playing. Eta: the only thing we had going for was was in state tuition at a state school. In other words, it's dangerous to play the assumption game.

[pixy0stix]

Bah. It's jealousy.

I do really like the changes that will be ongoing past the initial lump sum.

[idahome]

So how does it work when I’ve consolidated my undergraduate and law school loans into a single direct loan? I meet both of the income thresholds (either married or single). Does that mean $10,000 will be taken off my total balance due or will nothing? Also, I think I might’ve had a PELL grant in undergrad, for my first year, so maybe I’ll get $20,000 forgiven? More importantly, I would like to understand how the cap on payment as a percentage of monthly income will work.

Regardless, I’m glad they are doing this. I would’ve like to have seen more done regarding interest rates, capping monthly payments, and refinancing loans after consolidation (being able to stay in the federal program to do that). I do hope this really helps people across the board.