Student Loans 2022: All the Major Changes That Happened This Year
The 2022 news cycle was dominated by student loan headlines. Anxious borrowers kept up, or worked hard to keep up, with updates and changes in messaging as news was announced on a near-daily basis. Here’s a summary of the major changes that happened this year with student loans.
The US Department of Education Approved $415 Million in Borrower Defense Claims
On Feb. 16, 2022, the U.S. Department of Education announced the approval of $415 million in borrower defense claims.
These claims pertain to student loan borrowers who attended for-profit schools, including DeVry University. Nearly 16,000 student loan borrowers were able to get their student loan debt cleared.
Steps Are in the Works To Fix Student Loan Programs
Student loan debt, now a $1.7 trillion crisis in the United States, has several action steps in the works to fix it.
Take Our Poll: Do You Think Student Loan Debt Should Be Forgiven?
The U.S. Department of Education announced on April 19, 2022, immediate corrective actions, including addressing and ending forbearance steering, increasing oversight of servicers’ forbearance use and tracking progress toward IDR forgiveness. The Federal Student Aid (FSA) office stated these changes will be implemented immediately as of April 2022, but it may take until the last quarter of 2022 to see the effect in their accounts.
2022: The Year of Repayment Extensions
Restarting federal student loan payments was originally supposed to resume on May 1, 2022. For millions of Americans, this would mean resuming payments after nearly two years of being paused. As the deadline approached, borrowers found themselves seeking expert advice on how to budget and prepare for repayments accordingly.
By April 6, 2022, CNBC reported the Biden administration had extended the federal student loan payment pause to September 2022. The extra wiggle room gave borrowers some additional time to determine the necessary steps to take before payments started up again. However, by mid-August 2022 millions of borrowers felt frustrated, according to CNBC, about the lack of time to prepare and whether or not there would be another extension.
Another payment pause extension was announced by the Biden administration on Aug. 24, 2022. As reported by CNBC, this extension would go through the end of December. However, this is also not quite the final extension. On Nov. 22, 2022, NPR reported the Biden administration had extended federal student loan payments to no later than June 30, 2023.
Announcement of Federal Student Loan Relief
Speculation over student loan forgiveness and whether it would happen started making the conversation rounds in early 2022. On Aug. 24, 2022, the Biden administration announced a three-part plan to provide targeted student loan debt relief via a press release on The White House website.
Borrowers immediately had questions about the one-time student loan forgiveness plan, ranging from who is eligible, how the plan works and when they can apply. The Federal Student Aid website established a portal hub answering everything eligible borrowers needed to know about receiving a full or partial loan discharge up to $20,000.
At the current moment, however, applications are not being accepted by the FSA. This is due to a court order blocking the debt relief program. The U.S. Department of Education is encouraging applicants to subscribe and check in regularly for updates. Borrowers who have already applied for debt relief will have their applications held until further notice.
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