TAMPA, Fla. — If you or someone you know will still have student loan debt after President Joe Biden's administration announced a loan forgiveness plan on Wednesday, there are some things that you can do to potentially stretch your dollars.
You'll want to act fast to take advantage of a couple of programs because there are some deadlines coming up.
One is for the Public Service Loan Forgiveness waiver and the other is for an Income-Driven Payment waiver.
Christie Arkovich is an attorney in Tampa. Her firm specializes in helping people reduce student loan debts. Before she started her firm, she was trial counsel for student loan services.
Based on her experience, Arkovich said there is a sharper insight into how to take advantage of certain student loan forgiveness programs.
“You know how we've had this 99% denial rate [for Public Service Loan Forgiveness] for a while? Well, the fix that was announced in Oct. of last year has a one-year duration. So, it'll expire Oct. 31. That means anyone who needs to consolidate somebody who has an older loan type needs to consolidate their loans to a newer direct loan in order to take advantage of that," Arkovich said. "We tried to fix this for a number of years by filing class actions.”
She said this waiver will help many people.
“People who previously had payments, well that didn't count because either they were the wrong amount made the wrong day, under the wrong program or even under the wrong loan type. So, they all count now,” Arkovich said.
For students who were putting off making payments due to financial reasons, then there’s another solution instead of suffering from lengthy forbearances, according to Arkovich.
“If you have a chronic problem, where you just don't make enough money to pay your student loan back, along with basic living expenses and such, then you should really be an income-driven plan because there's a target at the end of those and it's called debt forgiveness," she said. "Forbearances don't have that end, they don't have the forgiveness at the end. They just have a rolling snowballing balance. So, the fix that was announced in April expires Dec. 31. People need to consolidate their loans into direct so that they qualify.”
Those impacted by student loan debt can go to studentaid.gov. Here, people can consolidate loans through the Department of Education.
“Most of our clients don't have $10,000 of student loan debt, they have upwards of six figures. It is far more important to take advantage of these fixes of broken programs than it is to get $10,000,” Arkovich said.
