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College Loan Forgiveness Program revamped for extra credit

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(WIVB) — The Biden administration made changes to the student loan forgiveness program that fell short.

But these changes are only temporary.

The civil service loan forgiveness program was getting terrible marks from the government for failing the college graduates it was supposed to help, so the US Department of Education made some changes to give former students an additional credit.

Noelle Carter, president of the Consumer Credit Counseling Service, told News 4 that the student loan forgiveness program has such an abysmal track record because it was incredibly complex in its requirements.

The program was designed to reward students who chose government jobs after graduation – 10 years of on-time loan repayments, and their debt balances would be wiped out.

“And lo and behold, 10 years later, people qualify — or think their loans are going to be canceled — and 99% of loan applications have been turned down,” Carter said.

Carter said qualifying for loan forgiveness is a complicated process, so the US Department of Education is offering half a million former students who were rejected a limited time to reapply and enter. in the program.

So far it seems to work.

Teacher Debbie Baker borrowed $35,000 for her college education in 1999, but after 10 years of one-time payments, her balance more than doubled after she was rejected for the forgiveness program.

Baker reapplied following the new guidelines and the entire debt was wiped out.

“It’s mind-boggling, just the stress and anxiety that’s been lifted,” Baker said.

Active service members who have felt the sting of rejection are also receiving help through the changes.

College loan repayments are deferred while the military serves their country, so they were not considered in the cancellation, as all public service jobs were considered the same.

“So you could be a teacher, you could be a service member,” Carter said. “It’s just first and foremost, the requirement of the program, or a rule of the program was, months of deferment do not count towards months of forgiveness.”

The consumer credit counseling service can guide government workers through the loan forgiveness application process for a nominal fee.

The revamped forgiveness program ends on October 31, 2022, but the final bell rings for some of the other relief programs much sooner.

Al Vaughters is an award-winning investigative journalist who has been on the News 4 team since 1994. See more of his work here. To submit a Call 4 action, click here.