President Joe Biden hasn’t canceled your student loans, but don’t pay for your student loan cancellation.
Here’s what you need to know – and what it means for your student loans.
If you follow the latest headlines on student loans, Biden has yet to adopt large-scale student loan cancellation. Despite pressure from Senator Elizabeth Warren (D-MA) and Senate Majority Leader Chuck Schumer (D-NY) to cancel up to $ 50,000 in student loans, Biden chose to focus on canceling targeted student loans. Since becoming president, Biden has canceled more student loans than any president. This includes $ 10 billion in student loan cancellations, including $ 1.5 billion in student loans canceled this way and billions in student loan cancellations for student loan borrowers with total and permanent disabilities. (Find out here how to apply for a student loan forgiveness). Without a large-scale student loan forgiveness, you might be wondering, “Should I stop paying my student loans?” If you haven’t gotten your student loan waiver, you may also want to pay a company to help you get your student loan waived. The lack of large-scale student loan cancellations has resulted in potential scams involving student loans. Here is what you need to know in order not to lose money:
1. There is no Biden student loan forgiveness
If someone promises you “Biden Student Loan Cancellation“, that’s a scam. Biden student loan forgiveness refers to the student loan forgiveness through the US Department of Education for your federal student loans. Biden’s student loan cancellation also refers to the student loan cancellation adopted by Biden under applicable law. Again, “Biden student loan cancellation” refers to the cancellation of the federal student loan through the federal government. No business can cancel your student loans. A typical scam involves a company – usually through an email or ad – that promises to cancel your student loans through the Biden student loan forgiveness program. Here’s the thing: There is no Biden student loan forgiveness. This scam resembles the Public Service Loan Forgiveness Program, which Congress created and which President George W. Bush, not Biden, enacted in 2007.
2. Don’t pay for a student loan forgiveness
If a company wants to charge you a fee for canceling your student loans, it’s a scam. Never pay a company an upfront fee to cancel your student loans or give you a student loan cancellation. It just doesn’t exist. The cancellation of the student loan is free. There is no charge for income-based repayment plans. There is no charge for the civil service loan forgiveness. There is no charge for the return of the teacher loan. All of these programs are offered free of charge through the federal government. Contact your student loan manager for more details.
3. Student Loan Cancellation: Do not hire a company affiliated with the US Department of Education
When it comes to canceling your student loan, don’t hire a company that claims to be affiliated with the US Department of Education. It just doesn’t exist. The US Department of Education directly cancels student loans. The Department of Education does not contract with third party companies to cancel your student loans. If a company claims a special relationship with the Department of Education, do not work with it. Again, you can get a student loan discount for free through the US Department of Education.
4. Student loan cancellation: don’t hire someone to negotiate your student loans
The cancellation of the student loan cannot be negotiated. If someone claims they can negotiate your student loans for you, they can’t. Unlike a garage sale, student loans are not negotiable. The US Department of Education doesn’t just negotiate your student loan balance because you’ve hired a ânegotiatorâ. Any company that claims it can reduce your student loan balance is misleading you. Don’t pay to negotiate your student loans.
5. Student loan cancellation does not expire
Student loan relief is here to stay. Yes, the temporary student loan forbearance expires on January 31, 2022. However, the student loan waiver and cancellation are here to stay. The cancellation of the student loan does not expire. Don’t believe a company that tells you to âact nowâ or that student loan cancellation is only available for a âlimited timeâ. Student loan cancellation is not a vacation sale. Student loan cancellation, income-oriented repayment plans, and student loan consolidation will continue to be available. The US Department of Education has solicited public comment and held hearings to improve student loan cancellation and repayment. While Biden can simplify student loan cancellation, student loan cancellation does not expire. Fortunately, you have time to cancel your student loan, so don’t let a company make you think otherwise.
Student loan: what to do if you get ripped off
If a business promises you a student loan discount, be sure to contact your bank right away. If you signed up for automatic payments to pay this business, turn off automatic payment. You can also file a complaint with:
- the Consumer Financial Protection Bureau (CFPB)
- your attorney general
- US Department of Education
- the Federal Trade Commission (FTC)
- Better Business Bureau
There are many options for student loan relief. Make sure you understand all of your options. Here are some popular ways to save money: