Firstly, as a reminder, all loans eligible for the student loan payment pause are also eligible for the debt relief, including loans held by ED and guaranty agencies.
The ED policy currently notes*:
- Borrowers with privately-held (non-federal) student loans are not eligible for debt relief. If they consolidated loans into a private (non-federal) loan, the consolidated private loan is not eligible for debt relief.
- Borrowers with Federal Family Education Loans (FFEL) held by lenders cannot receive the debt relief unless they consolidated those loans into the Direct Loan program before September 29, 2022.
Here are the actions borrowers should take to apply for or decline the one-time debt relief:
- If ED determines a borrower qualifies for debt relief without applying, they’ll send them an email if they’re signed up for alerts. These borrowers don’t have to take any action unless they want to opt out. If they want to opt out of debt relief for any reason they should contact their loan servicer by phone or email and tell them they don’t want to receive one-time student loan debt relief.
- All other borrowers need to complete the simple application.
- ED will process applications as they are received. The application period is open until Dec. 31, 2023.
Borrowers eligible for the debt relief will receive automatic refunds on payments made during the pandemic, as applicable. For example, if a borrower is eligible for $10,000 in relief; had a balance of $10,500 prior to March 13, 2020 (the beginning of the payment pause); and, made $1,000 in payments since then — their balance would be $9,500 at the time of discharge. ED will discharge the $9,500 balance and provide a $500 refund.
* The information provided is as of Oct. 18, 2022 but is constantly changing. To help ensure you have the most current information, we encourage you to visit ED's website at studentaid.gov.