More than 40 million Americans could see their student loan debt reduced under the forgiveness plan President Joe Biden announced this week.
In many cases, Americans could see their student loan debt completely eliminated. Biden is erasing $10,000 in federal student loan debt for people with incomes below $125,000 a year, or households that earn less than $250,000. He is canceling another $10,000 for people who received federal Pell Grants to attend college.
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He also extended the pause on federal student loan payments for the “final” time. The pause will run through the end of the year and repayments are expected to resume in January.
According to the White House, current students with loans are eligible for debt relief. Borrowers who are dependent students will be eligible for relief based on their parent’s income.
Parent Plus Loans, loans taken out by parents to pay for their child’s education are eligible for cancellation according to the Washington Post. They are subject to the same income thresholds.
Read: Federal student loan debt forgiveness: Answering the most common questions