The Biden Administration recently announced it will cancel up to $10,000 in federal student loan debt for borrowers who earn less than $125,000 a year, or families earning less than $250,000. Biden will also cancel up to an additional $10,000 in federal loan debt for people who received Pell Grants [1]as low-income undergraduate students.
The Department of Education paused all student loan repayment, interest, and collections for the eighth time since the COVID-19 pandemic began, lasting over two and a half years. That pause ends December 31, 2022, and interest and collections will resume.
The Department of Education is also putting a cap on monthly minimum payments for undergraduate loans. The cap limits monthly minimum payments to 5% of borrower's income — half the rate borrowers must currently pay.
