The IDR Account Adjustment looks at your oldest federal loan with qualifying payments and updates the payment count of all of your Direct Loans to match. For one client, that’s his Perkins Loan, which he started paying off in residency. FFELs and Perkins Loans, however, are ineligible for both PSLF and IDR forgiveness, normally. Suppose you consolidate them into a new Direct Consolidation Loan by the end of 2023. In that case, they become eligible and retain the highest existing payment count meaning not only got PSLF a year early on the loans he thought would be forgiven, he got ALL his loans forgiven!
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If you have a need for quick changes, immediate response, or more complex information, you may need to give your student loan servicer a call. None of them, however, have a great track record of customer service. That said, if you can endure the endless phone trees and wait times, you could be rewarded with same-day results. Sadly, it can take a bit of maneuvering to get to someone who can truly be helpful.
If the thought of paying your student loans is still making you cringe, give your student loan professional a call. We’re here to help you find your way out of the dark and toward a bright new path, free from your repayment woes!
Between these two initiatives, President Biden and Secretary Cardona have forgiven the federal student loans of over 1.5 million Americans by correcting decades old failures. We can’t wait to see what comes next! If you’re one of those whose loans were forgiven, we want to hear your story! If you want to become one of them, drop us a line and let us show you how we can make it happen!
Neither FSA nor loan servicers share sensitive information or figures in emails, but rather direct you to secure messaging on their websites. If you hear something that seems too good to be true, check it at studentaid.gov, or reach out to your student loan professional for trusted, tried-and-true advice.
There’s a new way to save money on your student loans, and it has an easy-to-remember name: SAVE! The “Saving on a Valuable Education” plan is the newest option for borrowers utilizing income-driven repayment to lower how much they owe each month.
First, make sure that you’re prepared to start making payments, up-to-date on correspondence, etc. If you’re afraid you can’t afford your payment, consider recertifying your income if it’s gone down over the last three-plus years. You can also enroll in the new SAVE plan.
If you have questions about whether your loans qualify for forgiveness under the IDR Account Adjustment, are wondering about consolidation, or how you could be impacted by federal loan forgiveness—such as whether that forgiveness may be taxed(!)—contact your student loan professional.
Like any uncertain investment, patience is key to reaping the rewards of an education. The fruits of your labor may not be what you set out to find, nor what you thought you needed, but, whatever you reap, you’ll need patience while it grows.
Borrowers first got this news back in January when the Department of Education announced that it would be revising the REPAYE plan, but Ed. has decided—instead of revising it—to replace it altogether. The new plan, SAVE (Saving on a Valuable Education), will be phased in over the next year and promises to be the most affordable plan yet.