A “beta test” of the student loan relief application was launched Friday evening, launching the Biden administration’s sweeping program to cancel the student debt of tens of millions of Americans.
The Education Department’s test request is a long-awaited first step in the policy announced in late August, which allows people with federal student loans to apply for up to $20,000 in debt relief , depending on the type of financial aid they received and how much money. they do.
During the beta testing period, according to a department spokesperson, borrowers will be able to submit applications for the student debt relief program and will not have to reapply if they submit their application during the beta test .
This period will help the department monitor the app’s site performance through “real-world usage” before the app’s official launch later this month, the department says, allowing it to refine processes and uncover any possible error
The highest amount of debt relief (up to $20,000) will go to people who received Pell College Grants, a type of aid given to students from low-income families. All other borrowers with federal loans will be eligible for up to $10,000 in relief.
The relief covers anyone who earned less than $125,000 in tax year 2020 or 2021, or less than $250,000 as a couple.
Borrowers should apply by mid-November in order to have their loans canceled when the pause on student loan payments is lifted on Jan. 1, 2023, the White House said. This pause has been in effect since the start of the pandemic. The debt relief application will also close at the end of the year and expire on December 31, 2022.
A student works in the Rice University Library in Houston, Aug. 29, 2022.
Brandon Bell/Getty Images, FILE
But there is a subset of borrowers who were kicked out of the program in a late reversal by the Biden administration as it tried to dodge the lawsuits. Anyone with a Perkins loan or a federal family education loan, both loans guaranteed by the federal government but managed by private banks, is no longer eligible for aid.
The Biden administration estimated that the rule change, made in late September, disqualified about 700,000 people from politics.
The administration has pointed out that it was a small minority of people compared to the potential reach this policy could have. However, as advocates have pointed out, the success of the policy depends on how many people hear about it and how easy it is to implement.
The policy is expected to apply to 43 million Americans, and 20 million could completely wipe out their debt, the White House estimates. It is expected to cost about $400 billion over 30 years, according to the Congressional Budget Office.
The app’s launch comes as the policy has been challenged multiple times in court, largely by conservative organizations and states that argue the Biden administration lacks the authority to write off student loan debt.
So far, none of the lawsuits have halted the program, which the Biden administration argues has a strong legal basis under the HEROES Act, a law that gives the Education Secretary broader authority than usual for periods of ’emergency, such as COVID-19. 19.
And President Joe Biden, while acknowledging the plan could be controversial, has also defended it as the right thing to do.
“Now, I understand that not everything I’m announcing today is going to make everybody happy,” Biden said in a speech at the White House when the policy was announced.
“I will never apologize for helping working and middle-class Americans,” he said.