Payment Pause Extended/Debt Cancellation
Recently, the US Department of Education ("Department") announced another extension of the pause on Direct Student Loan ("DL") repayment and collection activity through June 30th, 2023. As we have communicated in the past, FFELP loans are not included in this pause.
In conjunction with the extension of the payment pause, the Department also announced a plan of loan cancellation for loans presently held by the Department. The announced plan would cancel $10,000 worth of indebtedness per borrower ($20,000 if the borrower meets certain additional criteria) for all borrowers who meet certain income limits. Currently this program is suspended pending a decision by the Supreme Court of the United States. At the time of the suspension, only FFELP accounts that consolidated into the Direct Loan Program as of September 29th, 2022 would have been eligible for the relief.
No Refunds for FFELP Borrowers
The legal structure of the FFELP does not allow FFELP loan holders and servicers to make refunds of payments made during the pandemic emergency to FFELP borrowers.
Income Driven Repayment Waiver and Adjustment
On April 19, 2022, the U.S. Department of Education (ED) announced several changes and updates that will bring borrowers closer to forgiveness under income-driven repayment (IDR) plans. These adjustments to borrower accounts include conducting a one-time revision of IDR payment counters to address past inaccuracies (including automatically discharging loans for eligible borrowers) and permanently fixing IDR payment counting by reforming ED’s IDR tracking procedures going forward. ED will begin work on implementing these changes immediately, but borrowers will not see the effect in their accounts until fall of 2022. While all details are not currently available, you can review the information provided from the Department of Education at the link below:
https://studentaid.gov/announcements-events/idr-account-adjustment
Public Service Loan Forgiveness (PSLF)—Am I eligible?
Additional information: Public Service Loan Forgiveness
Currently Public Service Loan Forgiveness is not available for FFELP Loans. However, on Oct. 6, 2021, the U.S. Department of Education (ED) announced a change to PSLF program rules for a limited time as a result of the COVID-19 national emergency. The program changes will also apply to any qualifying FFELP loan that consolidates into the Direct Loan Program by October 31st 2022. For more information on the program and how it may benefit your account, please use the link below.
Our team is available for any questions or payment assistance. 505-345-3371 | 800-279-5063
StudentAid.gov/PSLFwaiver - information page on the limited PSLF waiver
StudentAid.gov/pslf - landing page for the PSLF help tool, where you can find out if the Department has previously determined of your employer qualifies for PSLF or not
StudentAid.gov/publicservice - information page about PSLF
StudentAid.gov/fsa-id/create-account - where you can go to get an FSA ID, which will enable you to receive direct communications from the Department as well as use the PSLF Help Tool and consolidate your loans
StudentAid.gov/consolidation - the landing page for the consolidation application
You may also call 1-800-4-FEDAID if you have additional questions about the limited PSLF waiver.
New Mexico Educational
Assistance Foundation (NMEAF)
Provider of New Mexico Student Loans
When it comes to how to pay for college, we’ve been helping students and families make smart financial decisions for more than 35 years. There are a variety of avenues to research when determining the best way to pay for college. Most students and families use several different sources to finance higher education, such as student loans.
Our partners with College Connect NM and NM Knowledge 4 College host FAFSA Workshops throughout the state of New Mexico. Attendees of the workshops who have completed their FAFSA are elgible to enter to win a $500 scholarship by completing this form: FAFSA Scholarship Form
Here’s our best advice on how to approach the different ways to finance your future: