1

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF TEXAS

FORT WORTH DIVISION

MYRA BROWN and ALEXANDER 

TAYLOR,

Plaintiffs,

v.

U.S. DEPARTMENT OF EDUCATION; 

MIGUEL CARDONA, in his official 

capacity as the Secretary of Education,

Defendants.

CIVIL ACTION NO. 

APPENDIX IN SUPPORT OF THE

MOTION FOR PRELIMINARY INJUNCTION

Description Bates Number(s)

Declaration of Myra Brown App. 1

Declaration of Alexander Taylor App. 4

Declaration of J. Michael Connolly App. 7

Exhibit A: StudentAid.gov web page titled One-Time 

Student Debt Relief, as it appeared on September 8, 2022

App. 9

Exhibit B: StudentAid.gov web page titled One-Time 

Student Debt Relief, as it appeared on October 1, 2022

App. 22

Declaration of Under Secretary of Education James 

Kvaal

App. 37

4:22-cv-908

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 1 of 85 PageID 57
2

Respectfully submitted,

s/ James F. Hasson _

J. Michael Connolly (VA Bar No. 77632)

James F. Hasson (TX Bar No. 24109982)

Matthew Pociask* (IL Bar No. 6336568)

CONSOVOY MCCARTHY PLLC

1600 Wilson Boulevard, Suite 700

Arlington, VA 22209

Tel: (703) 243-9423

Fax: (703) 243-9423

mike@consovoymccarthy.com

james@consovoymccarthy.com

matt@consovoymccarthy.com

Steven C. Begakis (VA Bar No. 95172)

CONSOVOY MCCARTHY PLLC

Fort Worth, TX

Tel: (703) 243-9423

Fax: (703) 243-9423

steven@consovoymccarthy.com

*Admitted in Illinois, but not Virginia. 

Supervised by principals at firm.

Counsel for Plaintiffs 

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 2 of 85 PageID 58
IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF TEXAS

FORT WORTH DIVISION

MYRA BROWN and ALEXANDER 

TAYLOR, 

Plaintiffs,

v.

U.S. DEPARTMENT OF 

EDUCATION; MIGUEL 

CARDONA, in his official capacity as 

the Secretary of Education, 

Defendants.

Case No. ________

DECLARATION OF MYRA BROWN

1. I am over the age of eighteen and under no mental disability or

impairment. I have personal knowledge of the following facts and, if called as a witness, 

I would competently testify to them.

2. I received my undergraduate degree from the University of Texas at ElPaso in 1993. I then attended graduate school at the Cox School of Business at Southern 

Methodist University in Dallas, Texas. 

3. I completed my graduate school studies in 2002.

4. To pay for graduate school, I received student loans through the Federal

Family Education Loan Program (“FFELP”). 

5. I currently have two FFELP loans totaling more than $17,000. My loans

are commercially held and are not in default. 

App. 1

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 3 of 85 PageID 59
6. Because my loans are commercially held and not in default, I am ineligible 

for debt forgiveness under the Debt Forgiveness Program. 

7. If the Department is going to provide debt forgiveness, I believe that my 

student loan debt should be forgiven too. 

8. I believe it is irrational, arbitrary, and unfair to exclude me from the 

program because my federal student loans are commercially held and not in default. 

9. I want an opportunity to present my views to the Department and provide 

additional comments on any proposal from the Department to forgive student loan 

debts. 

App. 2

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App. 3

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 5 of 85 PageID 61
IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF TEXAS

FORT WORTH DIVISION

MYRA BROWN and ALEXANDER 

TAYLOR,

Plaintiffs,

v.

U.S. DEPARTMENT OF 

EDUCATION; MIGUEL 

CARDONA, in his official capacity as 

the Secretary of Education,

Defendants.

Case No. ________

 

DECLARATION OF ALEXANDER TAYLOR

1. I am over the age of eighteen and under no mental disability or 

impairment. I have personal knowledge of the following facts and, if called as a witness, 

I would competently testify to them.

2. I received my undergraduate degree from the University of Dallas. To pay 

for my undergraduate studies, I received federal student loans through the Direct Loan 

Program. 

3. I currently have four loans totaling more than $35,000. My loans are held 

by the Department of Education. 

4. I am not married and made less than $125,000 in 2020 and 2021. 

5. Because I never received a Pell Grant, I am ineligible to receive $20,000 

in debt forgiveness under the Debt Forgiveness Program. 

App. 4

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 6 of 85 PageID 62
6. If the Department is going to provide debt forgiveness, I believe that my 

student loan debt should be forgiven too and that I should not be punished because I 

did not receive a Pell Grant in college. 

7. I make less than $25,000 a year, but I am ineligible for the $20,000 in debt 

forgiveness. 

8. Yet others making more than five times as much as I do (up to $125,000 

a year) will receive $20,000 in debt relief if they got a Pell Grant in college. 

9. I believe that it is irrational, arbitrary, and unfair to calculate the amount 

of debt forgiveness I receive based on the financial circumstances of my parents many 

years ago. 

10. I want an opportunity to present my views to the Department and provide 

additional comments on any proposal from the Department to forgive student loan 

debts. 

App. 5

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 7 of 85 PageID 63
App. 6

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 8 of 85 PageID 64
IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF TEXAS

FORT WORTH DIVISION

MYRA BROWN and ALEXANDER 

TAYLOR,

Plaintiffs,

v.

U.S. DEPARTMENT OF 

EDUCATION; MIGUEL 

CARDONA, in his official capacity as 

the Secretary of Education,

Defendants.

Case No. ________

 

DECLARATION OF J. MICHAEL CONNOLLY

1. I am an attorney at the law firm Consovoy McCarthy PLLC and am 

counsel for Plaintiffs.

2. I am over the age of eighteen and under no mental disability or 

impairment. I have personal knowledge of the following facts and, if called as a witness, 

I would competently testify to them.

3. Attached as Exhibit A is a true and correct copy of a web page from the 

Department of Education’s StudentAid.gov website titled One-Time Student Debt Relief, 

as it appeared on September 8, 2022, at https://studentaid.gov/debt-reliefannouncement/one-time-cancellation. An archived copy of the web page is available at 

https://bit.ly/3ygbuGz.

App. 7

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 9 of 85 PageID 65
4. Attached as Exhibit B is a true and correct copy of a web page from the 

Department of Education’s StudentAid.gov website titled One-Time Student Debt Relief, 

as it appeared on October 1, 2022, at https://studentaid.gov/debt-reliefannouncement/one-time-cancellation. An archived copy of the web page is available at 

https://bit.ly/3fBmyrm.

Per 28 U.S.C. §1746, I declare under penalty of perjury that the foregoing is true 

and correct to the best of my knowledge.

Executed on October 4, 2022.

/s/ J. Michael Connolly

 J. Michael Connolly 

App. 8

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Exhibit A

App. 9

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 11 of 85 PageID 67
The Wayback Machine - https://web.archive.org/web/20220908182538/https://studentaid.gov/debt-relief-anno...

One-Time Student Loan Debt Relief

On Aug. 24, 2022, the Biden-Harris Administration announced a Student Debt Relief Plan that

includes one-time student loan debt relief targeted to low- and middle-income families.

The U.S. Department of Education (ED) will provide up to $20,000 in debt relief to Federal Pell

Grant recipients and up to $10,000 in debt relief to non-Pell Grant recipients. Borrowers with

loans held by ED are eligible for this relief if their individual income is less than $125,000 (or

$250,000 for households).

What Do I Need to Know?

An official website of the United States governme

An online form will be available by early October. Here are some steps you can take

App. 10

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 12 of 85 PageID 68
Federal Pell Grants

y y p y

now and in the future.

Step 1: Check if you're eligible

You're eligible for student loan debt relief if your annual federal income was below

$125,000 (individual or married, filing separately) or $250,000 (married, filing jointly

or head of household) in 2021 or 2020.

$20,000 in debt relief: If you received a Pell Grant in college and meet the

income threshold, you'll be eligible for up to $20,000 in debt relief.

$10,000 in debt relief: If you did not receive a Pell Grant in college and meet the

income threshold, you'll be eligible for up to $10,000 in debt relief.

Step 2: Prepare

Here's what you can do to get ready and to make sure you get our updates:

Log in to your account on StudentAid.gov and make sure your contact info is up

to date. We'll send you updates by both email and text message, so make sure to

sign up to receive text alerts. If it's been a while since you've logged in, or you

can't remember if you have an account username and password (FSA ID), we

offer tips to help you access your account.

If you don't have a StudentAid.gov account (FSA ID), you should create an

account to help you manage your loans.

Make sure your loan servicer has your most current contact information so they

can reach you. If you don't know who your servicer is, you can log in and see

your servicer(s) in your account dashboard.

Step 3: Submit your application (when available)

The application will be available online by early October 2022.

We'll share updates on this page and send you an email when the application is

available. You'll have until Dec. 31, 2023, to submit your application.

How Do I Know If I Ever Received a Federal Pell Grant?

App. 11

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 13 of 85 PageID 69
If I have a Pell Grant, do I need to do anything to get the full $20,000 in debt

relief?



Yes. You just need to submit your application for debt relief. We have a record of

every student who has ever received a Federal Pell Grant. When you submit your

application, we'll check our records to determine if you have a Pell Grant, which

would qualify you for up to $20,000 in debt relief. You don't need to take any

additional action to show us that you received a Pell Grant.

Do I still qualify for the full $20,000 in debt relief if I received only one Pell

Grant?



Yes. As long as you received at least one Pell Grant of any amount, you qualify for the

additional $10,000 in debt relief. This additional $10,000 will be applied to eligible

loans, such as undergraduate, graduate, or parent loans. It doesn't matter if the Pell

Federal Pell Grants typically are awarded to undergraduate students with low or

moderate income.

Most borrowers can log in to StudentAid.gov to see if they received a Pell Grant. We

display information about the aid you received, including Pell Grants, on your

account dashboard and your “My Aid” pages.

Log In to Your Account

When you apply for debt relief, we'll make sure all borrowers who received a Pell

Grant receive the full benefit of up to $20,000 in relief if they meet the income

requirements. ED has data on all borrowers who received a Pell Grant. If you

received a Pell Grant prior to 1994, that information won't display in StudentAid.gov,

but you'll still receive the full benefit.

App. 12

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 14 of 85 PageID 70
Grant was used for the same program of study or at the same school as your federal

student loan(s).

If I have parent PLUS loans and my child received a Pell Grant, can the full

$20,000 in debt relief be applied to my parent PLUS loans?



No. Eligibility for debt relief is based on each borrower's situation.

If a dependent student received a Pell Grant, up to $20,000 in debt relief will be

applied to the student's loans—not to any loans their parent may have taken out.

A parent who has taken out loans—including loans for their own studies or parent

PLUS loans for their child—may qualify for debt relief if they meet the income

eligibility criteria. If a parent also received a Pell Grant for their own studies, then

the parent borrower may be eligible for up to $20,000 in relief on their loans.

Otherwise, the parent borrower may be eligible for up to $10,000 in debt relief.

Which Loans Are Eligible?

App. 13

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 15 of 85 PageID 71
The following types of federal student loans with an outstanding balance as of June 30, 2022,

are eligible for relief:

William D. Ford Federal Direct Loan (Direct Loan) Program loans

Subsidized loans

Unsubsidized loans

Parent PLUS loans

Graduate PLUS loans

Consolidation loans, as long as all of the underlying loans that were consolidated

were first disbursed on or before June 30, 2022

Federal Family Education Loan (FFEL) Program loans held by ED or in default at a

guaranty agency

Federal Perkins Loan Program loans held by ED

Defaulted loans (includes ED-held or commercially serviced Subsidized Stafford,

Unsubsidized Stafford, parent PLUS, and graduate PLUS; and Perkins loans held by ED)

How do I know what kinds of loans I have? 

You can identify your loan types by logging on to StudentAid.gov and selecting “My

Aid” in the dropdown menu under your name. In the “Loan Breakdown” section,

you'll see a list of each loan you received. You'll also see loans you paid off or

consolidated into a new loan. If you expand “View Loans” and select the “View Loan

Details” arrow next to a loan, you'll see the more detailed name for that loan. 

Direct Loans begin with the word “Direct.” Federal Family Education Loan Program

loans begin with “FFEL.” Perkins Loans include the word “Perkins” in the name. If

the name of your servicer starts with “Dept. of Ed” or “Default Management

Collection System,” your FFEL or Perkins loan is federally managed (i.e., held by ED).

The “My Aid” section will also show you the servicer(s) for your loans.

Are defaulted loans eligible for debt relief?

App. 14



Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 16 of 85 PageID 72
Are defaulted loans eligible for debt relief? 

Yes, defaulted loans are eligible for debt relief. If you have a remaining balance on

your defaulted loan(s) after relief is applied, consider getting or staying out of default

through the Fresh Start initiative.

Are private loans (i.e., non-federal loans) eligible for debt relief? 

No. Private (non-federal) loans are not eligible for debt relief. If you consolidated

federal loans into a private (non-federal) loan, the consolidated private loan is not

eligible for debt relief.

Are parent PLUS loans and graduate PLUS loans eligible for debt relief? 

Yes. All ED-held loans, including PLUS loans for parents and graduate students, are

eligible for relief.

Are Federal Family Education Loans (FFEL) or Perkins Loans eligible for debt

relief?



It depends. All loans eligible for the student loan pause are also eligible for relief,

including loans held by ED and guaranty agencies. 

ED is assessing whether to expand eligibility to borrowers with privately owned

federal student loans, including FFEL and Perkins Loans. In the meantime,

borrowers with privately held federal student loans, such as through the FFEL,

Perkins, and HEAL programs, can receive this relief by consolidating these loans into

the Direct Loan program. 

App. 15

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 17 of 85 PageID 73
FFEL Joint Consolidation Loans, often referred to as spousal consolidation loans, are

not eligible for consolidation into the Direct Loan program under current law.

Frequently Asked Questions (FAQs)

General Info About Debt Relief

How can I find out how much debt relief I'll get?

If you meet the income requirements and have eligible loans, the amount of your

debt relief will depend on your outstanding balance and whether you received a

Federal Pell Grant. 

If you received a Pell Grant, you can receive up to $20,000 in debt relief.

If you didn't receive a Pell Grant, you can receive up to $10,000 in debt relief.

If your outstanding loan balance is less than the maximum amount of debt relief

you're eligible for, you'll receive only relief of your full loan balance. 

Once you submit your application for debt relief, we'll determine your relief amount.

How will I know when debt relief has been applied to my account? 

Your loan servicer will notify you when the relief has been applied to your account,

with details on how the relief was applied.

What happens if I still have a loan balance after debt relief is applied? 

Loan balances remaining after relief will be re-amortized, meaning we will

recalculate your monthly payment based on your new balance, potentially reducing

App. 16

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your monthly payment. Your loan servicer will communicate your new payment

amount to you.

Do I have to be repaying my loans to be eligible for debt relief? 

No. Borrowers are eligible for debt relief regardless of whether they're in repayment,

in school, or in grace, as long as they meet the income requirements and have eligible

loans.

If I have multiple loans, can I pick which loans get the relief? 

We'll determine how relief gets applied to your loans. See the next FAQ for additional

details. Federal Student Aid will make this determination and provide the guidance

to loan servicers, who will then process the relief.

How will debt relief be applied to my loans? 

For borrowers with multiple loans, we'll apply the relief in the following order:

Defaulted ED-held loans

Defaulted commercial FFEL Program loans

Non-defaulted Direct Loan Program loans and FFEL Program loans held by ED

Perkins Loans held by ED

If you have multiple loans in a program type (e.g., multiple Direct Loan Program

loans), we'll apply the relief in the following order:

Apply relief to loans with highest statutory interest rate.

App. 17

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 19 of 85 PageID 75
If interest rates are the same, apply to unsubsidized loans prior to subsidized

loans.

If interest rate and subsidy status are the same, apply to the most recent loan.

If interest rate, subsidy status, and disbursement date are the same, apply to the

loan with the lowest combined principal and interest balance.

Will my debt relief be taxed? 

One-time student loan debt relief will not be subject to federal income taxes. State

and local tax implications will vary.

How do I get help if I have questions or need assistance? 

We'll continue to update this page as we have more details. The program

information you can read here is the same information our contact center

agents have at this time. After the online application is live, support for the form

will be available at 1-833-932-3439.

Applying for Debt Relief

Will any borrowers receive automatic debt relief? 

Although most borrowers will have to apply for debt relief, we have income data on

hand for around 8 million borrowers. These borrowers will get the relief

automatically.

How will I know if I automatically qualify for debt relief? 

App. 18

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If we determine that you automatically qualify for debt relief, we'll send you an

email and text message (if you're signed up for text alerts). You don't have to take any

action. We'll provide your information to your loan servicer to process your relief. 

We'll use Free Application for Federal Student Aid (FAFSA ) and income-driven

repayment application information to identify borrowers—or, as appropriate,

parents—who have submitted income data for tax years 2021 or 2020. We'll use this

data to determine which borrowers meet the income requirements. If we have

borrower data for both years, we'll use the year with the lower income.

When will the online application be available? 

The online application will be available by early October 2022.

How do I know if you received my application? 

When you submit your application for debt relief, you'll see a page online confirming

your form was submitted. You'll also get a confirmation email from us, so make sure

we have your most current email address. You can log in to StudentAid.gov and

review your contact information.

What happens if I applied for Public Service Loan Forgiveness (PSLF)? 

We'll identify any borrower who submitted both an application for one-time student

loan debt relief and a PSLF form. If you receive one-time student loan debt relief and

are then determined to have been eligible for forgiveness under PSLF, we'll adjust

your loan and apply the PSLF discharge. The PSLF discharge may provide a refund

on certain eligible payments made after the borrower has already made 120

payments.

®

App. 19

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 21 of 85 PageID 77
How long do I have to apply for debt relief? 

You'll have until Dec. 31, 2023, to submit your application for student loan debt relief.

Is there a paper version of the debt relief application? 

Initially, the application will be available only online. A paper version of the form

will be made available at a future date, and you'll have until Dec. 31, 2023, to apply.

Beware of Scams

You might be contacted by a company saying they will help you get loan discharge,

forgiveness, cancellation, or debt relief for a fee. You never have to pay for help with

your federal student aid. Make sure you work only with ED and our trusted partners,

and never reveal your personal information or account password to anyone. Our

emails to borrowers come from noreply@studentaid.gov.

Learn how to avoid scams and what you can do if you're contacted by a scammer.

Get Support

We'll continue to update this page as we have more details. At this time, our contact center

agents have the same information you can read here. After the online form is live, support

for the form will be available at 1-833-932-3439.

Additional Links

Debt Relief Announcement

App. 20

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 22 of 85 PageID 78
Public Service Loan Forgiveness

Income-driven Repayment Plans

Who's My Servicer?

usa.gov | ed.gov

App. 21

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Exhibit B

App. 22

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 24 of 85 PageID 80
The Wayback Machine - https://web.archive.org/web/20221001000544/https://studentaid.gov/debt-relief-announce...

An official website of the United States governme

One-Time Student Loan Debt Relief

On Aug. 24, 2022, the Biden-Harris Administration announced a Student Debt Relief Plan that

includes one-time student loan debt relief targeted to low- and middle-income families.

The U.S. Department of Education (ED) will provide up to $20,000 in debt relief to Federal Pell

Grant recipients and up to $10,000 in debt relief to non-Pell Grant recipients. Borrowers with

loans held by ED are eligible for this relief if their individual income is less than $125,000 (or

$250,000 for households).

What Do I Need to Know?

An online form will be available in October 2022. Here are some steps you can

App. 23

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 25 of 85 PageID 81
Federal Pell Grants

p y

take now and in the future.

Step 1: Check if you're eligible

You're eligible for student loan debt relief if your annual federal income was below

$125,000 (individual or married, filing separately) or $250,000 (married, filing jointly

or head of household) in 2020 or 2021.

$20,000 in debt relief: If you received a Pell Grant in college and meet the

income threshold, you'll be eligible for up to $20,000 in debt relief.

$10,000 in debt relief: If you did not receive a Pell Grant in college and meet the

income threshold, you'll be eligible for up to $10,000 in debt relief.

Step 2: Prepare

Here's what you can do to get ready and to make sure you get our updates:

Log in to your account on StudentAid.gov and make sure your contact info is up

to date. We'll send you updates by both email and text message, so make sure to

sign up to receive text alerts. If it's been a while since you've logged in, or you

can't remember if you have an account username and password (FSA ID), we

offer tips to help you access your account.

If you don't have a StudentAid.gov account (FSA ID), you should create an

account to help you manage your loans.

Make sure your loan servicer has your most current contact information so they

can reach you. If you don't know who your servicer is, you can log in and see

your servicer(s) in your account dashboard.

To be notified when the process has officially opened, sign up at the Department

of Education subscription page.

Step 3: Submit your application (when available)

The application will be available online in October 2022.

We'll share updates on this page and send you an email when the application is

available. You'll have until Dec. 31, 2023, to submit your application.

App. 24

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 26 of 85 PageID 82
If I have a Pell Grant, do I need to do anything to get the full $20,000 in debt

relief?



Yes. You just need to submit your application for debt relief. We have a record of

every student who has ever received a Federal Pell Grant. When you submit your

application, we'll check our records to determine if you have a Pell Grant, which

would qualify you for up to $20,000 in debt relief. You don't need to take any

additional action to show us that you received a Pell Grant.

Do I still qualify for the full $20,000 in debt relief if I received only one Pell

Grant?



Yes. As long as you received at least one Pell Grant of any amount, you qualify for

$20,000 in debt relief. This debt relief will be applied to eligible loans, such as

How Do I Know If I Ever Received a Federal Pell Grant?

Federal Pell Grants typically are awarded to undergraduate students with low or

moderate income.

Most borrowers can log in to StudentAid.gov to see if they received a Pell Grant. We

display information about the aid you received, including Pell Grants, on your

account dashboard and your “My Aid” pages.

Log In to Your Account

When you apply for debt relief, we'll make sure all borrowers who received a Pell

Grant receive the full benefit of up to $20,000 in relief if they meet the income

requirements. ED has data on all borrowers who received a Pell Grant. If you

received a Pell Grant prior to 1994, that information won't display in StudentAid.gov,

but you'll still receive the full benefit.

App. 25

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 27 of 85 PageID 83
undergraduate, graduate, or parent loans. It doesn't matter if the Pell Grant was used

for the same program of study or at the same school as your federal student loan(s).

If I have parent PLUS loans and my child received a Pell Grant, can my child's

$20,000 in debt relief be applied to my parent PLUS loans?



No. The debt relief will be applied only to your child's loan(s).

If a dependent student received a Pell Grant, up to $20,000 in debt relief will be

applied to the student's loans—not to any loans their parent may have taken out.

A parent who has taken out loans—including loans for their own studies or parent

PLUS loans for their child—may qualify for debt relief if they meet the income

eligibility criteria. If a parent also received a Pell Grant for their own studies, then

the parent borrower may be eligible for up to $20,000 in relief on their loans.

Otherwise, the parent borrower may be eligible for up to $10,000 in debt relief.

Which Loans Are Eligible?

App. 26

Case 4:22-cv-00908-O Document 5 Filed 10/10/22 Page 28 of 85 PageID 84
The following types of federal student loans with an outstanding balance as of June 30, 2022,

are eligible for relief:

William D. Ford Federal Direct Loan (Direct Loan) Program loans

Federal Family Education Loan (FFEL) Program loans held by ED or in default at a

guaranty agency

Federal Perkins Loan Program loans held by ED

Defaulted loans (includes ED-held or commercially serviced Subsidized Stafford,

Unsubsidized Stafford, parent PLUS, and graduate PLUS; and Perkins loans held by ED)

This means that subsidized loans, unsubsidized loans, parent PLUS loans, and graduate PLUS

loans held by ED are eligible. Consolidation loans are also eligible for relief, as long as all of

the underlying loans that were consolidated were ED-held loans and were disbursed on or

before June 30, 2022. Additionally, consolidation loans comprised of any FFEL or Perkins

loans not held by ED are also eligible, as long as the borrower applied for consolidation before

Sept. 29, 2022.

How do I know what kinds of loans I have? 

You can identify your loan types by logging on to StudentAid.gov and selecting “My

Aid” in the dropdown menu under your name. In the “Loan Breakdown” section,

you'll see a list of each loan you received. You'll also see loans you paid off or

consolidated into a new loan. If you expand “View Loans” and select the “View Loan

Details” arrow next to a loan, you'll see the more detailed name for that loan. 

Direct Loans begin with the word “Direct.” Federal Family Education Loan Program

loans begin with “FFEL.” Perkins Loans include the word “Perkins” in the name. If

the name of your servicer starts with “Dept. of Ed” or “Default Management

Collection System,” your FFEL or Perkins loan is federally managed (i.e., held by ED).

The “My Aid” section will also show you the servicer(s) for your loans.

Are defaulted loans eligible for debt relief? 

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Yes, defaulted loans are eligible for debt relief. If you have a remaining balance on

your defaulted loan(s) after relief is applied, consider getting or staying out of default

through the Fresh Start initiative.

Are private loans (i.e., non-federal loans) eligible for debt relief? 

No. Private (non-federal) loans are not eligible for debt relief. If you consolidated

federal loans into a private (non-federal) loan, the consolidated private loan is not

eligible for debt relief.

Are parent PLUS loans and graduate PLUS loans eligible for debt relief? 

Yes. All ED-held loans, including PLUS loans for parents and graduate students, are

eligible for relief.

Are Federal Family Education Loan (FFEL) Program loans or Perkins Loans

eligible for debt relief?



All loans eligible for the student loan payment pause are also eligible for relief,

including loans held by ED and guaranty agencies. 

As of Sept. 29, 2022, borrowers with federal student loans not held by ED cannot

obtain one-time debt relief by consolidating those loans into Direct Loans.

Borrowers with FFEL Program loans and Perkins Loans not held by ED who have

applied to consolidate into the Direct Loan program prior to Sept. 29, 2022, are

eligible for one-time debt relief through the Direct Loan program.

ED is assessing whether there are alternative pathways to provide relief to borrowers

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with federal student loans not held by ED, including FFEL Program loans and Perkins

Loans, and is discussing this with private lenders.

Frequently Asked Questions (FAQs)

General Info About Debt Relief

How can I find out how much debt relief I'll get?

If you meet the income requirements and have eligible loans, the amount of your

debt relief will depend on your outstanding balance and whether you received a

Federal Pell Grant. 

If you received a Pell Grant, you can receive up to $20,000 in debt relief.

If you didn't receive a Pell Grant, you can receive up to $10,000 in debt relief.

If your outstanding loan balance is less than the maximum amount of debt relief

you're eligible for, you'll receive relief only of your full loan balance. 

The application for debt relief will be available in October 2022. Once you submit

your application, we'll determine your relief amount.

What will I need to complete the application? 

The application will be a short online form. You won't need your FSA ID, and you

won't need to upload any documents to submit your application. Our goal is to

provide borrowers a seamless and simple experience, and we're working closely

with the servicers who will process the relief.

How will I know when debt relief has been applied to my account? 

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Your loan servicer will notify you when the relief has been applied to your account.

What happens if I still have a loan balance after debt relief is applied? 

Loan balances remaining after relief will be re-amortized, meaning we will

recalculate your monthly payment based on your new balance, potentially reducing

your monthly payment. Your loan servicer will communicate your new payment

amount to you.

Am I eligible for a refund if I made voluntary payments during the pandemic? 

Yes. You will automatically receive a refund of your payments during the payment

pause if:

you successfully apply for and receive debt relief under the Administration's

debt relief plan, AND

your voluntary payments during the payment pause brought your balance below

the maximum debt relief amount you're eligible to receive but did not pay off

your loan in full.

For example, if you're a borrower eligible for $10,000 in relief; had a balance of

$10,500 prior to March 13, 2020; and made $1,000 in payments since then—

bringing your balance to $9,500 at the time of discharge—we'll discharge your

$9,500 balance, and you'll receive a $500 refund.

Other borrowers can still receive refunds on voluntary payments made after March

13, 2020, by contacting their servicer. It's important to note that these refunded

payments will increase your loan balance and your monthly payments. If you expect

to have a balance after discharge is applied and wish to request a refund, you can do

so by contacting your servicer until Dec. 31, 2023.

If you consolidated your loan after March 13, 2020, refunds aren't available for any

voluntary payments made prior to the consolidation.

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Refund requests can only be made by you and refunded to you, even if someone else

made a payment on your loan.

Do I have to be repaying my loans to be eligible for debt relief? 

No. Borrowers are eligible for debt relief regardless of whether they're in repayment,

in school, or in grace, as long as they meet the income requirements and have eligible

loans.

If I have multiple loans, can I pick which loans get the relief? 

We'll determine how debt relief gets applied to your loans. We'll then provide the

guidance to loan servicers, who will process the relief. See below for additional

details.

How will debt relief be applied to my loans? 

For borrowers with multiple loans, we'll apply the relief in the following order:

Defaulted ED-held loans

Defaulted commercial FFEL Program loans

Non-defaulted Direct Loan Program loans and FFEL Program loans held by ED

Perkins Loans held by ED

If you have multiple loans in a program type (e.g., multiple Direct Loan Program

loans), we'll apply the relief in the following order:

Apply relief to loans with highest statutory interest rate.

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If interest rates are the same, apply to unsubsidized loans prior to subsidized

loans.

If interest rate and subsidy status are the same, apply to the most recent loan.

If interest rate, subsidy status, and disbursement date are the same, apply to the

loan with the lowest combined principal and interest balance.

Will my debt relief be taxed? 

One-time student loan debt relief will not be subject to federal income taxes. State

and local tax implications will vary.

For most borrowers, you will receive debt relief only if you submit an application.

But some borrowers may be eligible for relief without applying. If you would like to

opt out of debt relief for any reason—including because you are concerned about a

state tax liability—you will be given an opportunity to opt out. (See below, “What if I

don't want to receive debt relief?”)

How do I get help if I have questions or need assistance? 

We'll continue to update this page as we have more details. The program

information you can read here is the same information our contact center

agents have at this time. After the online application is live, support for the form

will be available at 1-833-932-3439.

Applying for Debt Relief

Will any borrowers receive debt relief without applying? 

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Although most borrowers will have to apply for debt relief, we have income data on

hand for around 8 million borrowers. These borrowers will get the relief without

applying, unless they choose to opt out (see below, “What if I don't want to receive

debt relief?”).

How will I know if I qualify for debt relief without applying? 

If we determine that you qualify for debt relief without applying, we'll send you an

email and text message (if you're signed up for text alerts). You don't have to take any

action, unless you would like to opt out (see below, “What if I don't want to receive

debt relief?”). We'll provide your information to your loan servicer to process your

relief. 

We'll use Free Application for Federal Student Aid (FAFSA ) and income-driven

repayment application information to identify borrowers—or, as appropriate,

parents—who have submitted income data for tax years 2020 or 2021. We'll use this

data to determine which borrowers meet the income requirements. If we have

borrower data for both years, we'll use the year with the lower income.

I'm a dependent student. Do I apply based on my income or my parents'

income?



If you were enrolled in school as a dependent student for financial aid purposes

between July 1, 2021, and June 30, 2022, your eligibility is based on parent income.

After you fill out your own application form, we'll contact you so your parent can

complete a Parent Income Form.

When will the online application be available? 

The online application will be available in October 2022.

®

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How do I know if you received my application? 

When you submit your application for debt relief, you'll see a page online confirming

your form was submitted. You'll also get a confirmation email from us, so make sure

we have your most current email address. You can log in to StudentAid.gov and

review your contact information.

What happens if I applied for Public Service Loan Forgiveness (PSLF)? 

We'll identify any borrower who submitted both an application for one-time student

loan debt relief and a PSLF form. If you receive one-time student loan debt relief and

are then determined to have been eligible for forgiveness under PSLF, we'll adjust

your loan and apply the PSLF discharge. The PSLF discharge may provide a refund

on certain eligible payments made after the borrower has already made 120

payments.

How long do I have to apply for debt relief? 

You'll have from October 2022 until Dec. 31, 2023, to submit your application for

student loan debt relief.

Is there a paper version of the debt relief application? 

Initially, the application will be available only online. A paper version of the form

will be made available at a future date, and you'll have until Dec. 31, 2023, to apply.

What if I don't want to receive debt relief?

App. 34



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What if I don t want to receive debt relief? 

For most borrowers, you will receive debt relief only if you submit an application.

But if you completed a Free Application for Federal Student Aid (FAFSA ) form for the

2022–23 school year or are enrolled in an income-driven repayment plan based on

your 2020 or 2021 income, you may be eligible for relief without applying. If you

would like to opt out of debt relief for any reason—including because you are

concerned about a state tax liability—you'll be given an opportunity to opt out.

Beware of Scams

You might be contacted by a company saying they will help you get loan discharge,

forgiveness, cancellation, or debt relief for a fee. You never have to pay for help with

your federal student aid. Make sure you work only with ED and our loan servicers, and

never reveal your personal information or account password to anyone. Our emails to

borrowers come from noreply@studentaid.gov, noreply@debtrelief.studentaid.gov, or

ed.gov@public.govdelivery.com. You can report scam attempts to the Federal Trade

Commission by calling 1-877-382-4357 or by visiting reportfraud.ftc.gov.

Learn how to avoid scams and what you can do if you're contacted by a scammer.

Get Support

We'll continue to update this page as we have more details. At this time, our contact center

agents have the same information you can read here. After the online form is live, support

for the form will be available at 1-833-932-3439.

Additional Links

Debt Relief Announcement

Public Service Loan Forgiveness

Income-driven Repayment Plans

®

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Income-driven Repayment Plans

Who's My Servicer?

usa.gov | ed.gov

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1 

IN THE UNITED STATES DISTRICT COURT 

FOR THE EASTERN DISTRICT OF MISSOURI 

EASTERN DIVISION 

STATE OF NEBRASKA, 

STATE OF MISSOURI, 

STATE OF ARKANSAS, 

STATE OF IOWA, 

STATE OF KANSAS, and 

STATE OF SOUTH CAROLINA, 

Plaintiffs, 

 v. 

JOSEPH R. BIDEN, Jr., 

in his official capacity as the President of 

the United States of America; 

MIGUEL CARDONA, in his official 

capacity as Secretary, United States 

Department of Education; and 

UNITED STATES DEPARTMENT OF 

EDUCATION, 

Defendants. 

No. 4:22-cv-01040 

DECLARATION OF JAMES RICHARD KVAAL

I, James Richard Kvaal, do declare under penalty of perjury and pursuant to 28 U.S.C. 

§ 1746, that the following is true and accurate to the best of my information and belief:

1. I am the Under Secretary of Education at the United States Department of

Education (Department). My nomination for this position was confirmed by the United States 

Senate on September 14, 2021, and I was sworn in on September 15, 2021. I am a duly 

authorized Custodian of Records, or other qualified witness for the Department, located in 

Washington, District of Columbia. As such, I am fully competent to make the statements 

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2 

contained in this Declaration and I have authority to certify the attached records. I make this 

declaration based on my personal knowledge, based on information provided to me in my 

official capacity. 

2. As the Under Secretary of Education, my responsibilities include the coordination 

of major policies, programs, and activities related to Postsecondary Education and Federal 

Student Aid for the Department. This includes, but is not limited to, the development of policies, 

procedures, and directives related to the August 24, 2022 decision of the Secretary of Education 

(Secretary) to provide one-time student loan debt relief under the Higher Education Relief 

Opportunities for Students Act of 2003 (HEROES Act). 

3. In execution of my responsibilities, I have under my custody and control 

documents related to the decision of the Secretary to provide one-time student loan debt relief. 

These documents are: (A) an August 24, 2022 memorandum from myself to the Secretary 

recommending the Secretary exercise his discretion under the HEROES Act to issue waivers and 

modifications necessary to effectuate one-time student loan debt relief, including an August 24, 

2022 document titled “Rationale for Pandemic-Connected Loan Discharge Program” that was 

attached to my memorandum, (B) an August 24, 2022 memorandum from the Secretary to 

Federal Student Aid Chief Operating Officer Richard Cordray and signed by the Secretary 

reflecting his determination to issue waivers and modifications necessary to effectuate the onetime student loan debt relief program, and (C) a September 27, 2022 memorandum from the 

Secretary to the Chief Operating Officer and Assistant Secretary for Postsecondary Education 

Nasser Paydar, issuing the specific waivers and modifications and directing their implementation 

and publication in the Federal Register. These documents are attached as exhibits A, B, and C, 

respectively. 

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3 

4. I also have under my custody and control documents related to the Department’s

decision that Federal Family Education Loan Program (FFELP) borrowers who did not apply to 

consolidate into the Direct Loan Program (DLP) before September 29, 2022 would not be 

eligible to receive one-time loan student debt relief. These documents are: (D) a September 28, 

2022 copy edit document showing these changes to the Frequently Asked Questions (FAQ) web

page for the one-time student loan debt relief on Federal Student Aid’s website, (E) a September 

28, 2022 copy of the task order created to communicate these changes to Accenture, the 

Department’s contractor, and (F) an automatically-generated email from Federal Student Aid’s 

web content system from 10:45 PM ET on September 28, 2022 communicating this task order to 

Accenture to update the FAQ web page with the contents described in the copy edit document. 

These documents are attached as exhibits D, E, and F, respectively. The names of Accenture 

employees have been redacted.

5. Over the next several weeks, the Department will be taking steps to implement the

debt relief plan, potentially including continuing to communicate with servicers regarding 

implementation, sending emails notifying borrowers eligible for automatic relief of their 

eligibility and the option to opt out, communicating with borrowers and other interested parties 

concerning debt relief, conducting testing of the application form with members of the general 

public before the application form is fully launched (including sending emails inviting members 

of the public to participate in such testing), and announcing and opening the application form. 

The Department will not discharge any student loan debt under the debt relief plan prior to

October 23, 2022. 

6. I certify that each of the attached records: (1) is the original or a duplicate of the

original record in the custody of the Department; (2) was made at or near the time of the 

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4 

occurrence of the matters set forth by, or from information transmitted by, a person with 

knowledge of those matters; (3) was kept in the course of the Department’s regularly conducted 

activity; and (4) was made in the course of the regular conduct of the Department. These 

documents will all be part of the Administrative Record in this case. I am providing them now 

as part of the Department’s opposition to Plaintiffs’ motions for a temporary restraining order 

and a preliminary injunction, which were filed contemporaneously with Plaintiffs’ complaint 

(i.e., before the compilation and certification of an administrative record). 

 

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Exhibit A

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DELIBERATIVE / PRE-DECISIONAL / CONFIDENTIAL 

400 MARYLAND AVE., S.W., WASHINGTON, DC 20202 

www.ed.gov 

UNITED STATES DEPARTMENT OF EDUCATION 

THE UNDER SECRETARY 

 

DATE: August 24, 2022 

TO: Miguel A. Cardona, Ed.D. 

 Secretary of Education 

FROM: James Kvaal 

 Under Secretary of Education 

 

SUBJECT: Pandemic-Connected Loan Cancellation 

In March 2020, Congress determined that, in light of the COVID-19 pandemic, it was necessary 

to provide relief to student loan borrowers by suspending certain payments and collections 

activity, and temporarily setting certain interest rates to zero percent. Under the authority granted 

to the Secretary of Education by the Higher Education Relief Opportunities for Students Act of 

2003 (“HEROES Act”), you previously extended this relief through August 31, 2022. 

This payment pause has delivered substantial relief to millions of loan borrowers, seeking to 

ensure that they are not in a worse position financially due to the pandemic. However, when loan 

payments resume, many borrowers will be at heightened risk of loan delinquency and default 

that could offset the benefits provided by the pause and leave borrowers worse off than they were 

before the pandemic. As outlined in the attached analysis prepared by your advisors, many 

borrowers will experience challenges in the transition back to repayment. Additional steps are 

needed to address these challenges and reduce the likelihood of delinquency and default to 

ensure that borrowers are not in a worse position financially due to the pandemic with regard to 

their ability to repay their loans. 

In order to ensure that borrowers subject to the payment pause are not placed in a worse position 

financially by the COVID-19 national emergency as they restart payments, I recommend that 

you exercise your discretion under the HEROES Act to issue waivers and modifications 

necessary to effectuate the following actions: 

 Discharge $10,000 of federal student loan balances for borrowers with individual 

incomes of under $125,000 or household incomes of under $250,000 during tax years 

2020 or 2021. These discharges would be limited to loans that were originally 

outstanding as of June 30, 2022, and that are currently subject to the payment pause, 

including Direct Loans, Federal Family Education Loans held by the Department or by 

guaranty agencies, and Federal Perkins Loans held by the Department. 

 

 Discharge an additional $10,000 in federal student debt for borrowers who meet these 

requirements and who also received a Pell Grant at some point in the past. 

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DELIBERATIVE / PRE-DECISIONAL / CONFIDENTIAL 

Page 2 

 Take the administrative steps needed to implement this discharge initiative, including the 

collection, maintenance, use, and dissemination of borrower information necessary to 

establish eligibility for the discharge under the relevant criteria and provide benefits 

under the initiative automatically to as many borrowers as possible utilizing income 

information available to the Department in compliance with applicable law. 

 Develop a simple process for borrowers to attest to their incomes and for FSA to verify 

the income of a sample of those borrowers. 

Based on current economic and public health conditions, and to provide time to successfully 

implement these measures needed to ensure that borrowers are not placed in a worse position 

financially due to the pandemic, I also recommend that you extend those waivers and 

modifications specified in the December 11, 2020, Federal Register notice (85 Fed. Reg. 79856), 

that relate to the payment and collection of, and accumulation of interest on, federal student 

loans, and also extend the corresponding pause for Federal Family Education Loan Program 

loans held by guaranty agencies, as discussed in Dear Colleague Letter GEN-21-03 through 

December 31, 2022. Because this extension is expected to be the final extension of the payment 

pause, I further recommend that you direct FSA to take all necessary steps to restart loan 

payments after December 31, 2022. 

If you approve these recommendations, please sign the attached memorandum to the Chief 

Operating Officer of Federal Student Aid. 

Attachments: 

1. Rationale for Pandemic-Connected Loan Cancellation Program 

2. Memorandum to Chief Operating Officer Cordray prepared for your signature 

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1 

Rationale for Pandemic-Connected Loan Discharge Program 

August 24, 2022 

I. Background 

In March 2020, Congress determined that, in light of the COVID-19 pandemic, it was necessary to 

provide relief to student loan borrowers by suspending certain payments and collections activity, and 

temporarily setting certain interest rates to zero percent. Under the authority granted to the Secretary of 

Education by the Higher Education Relief Opportunities for Students Act of 2003 (“HEROES Act”), the 

Secretary previously extended this relief through August 31, 2022. 

This payment pause has delivered substantial relief to millions of loan borrowers, seeking to ensure that 

they are not in a worse position financially due to the pandemic. However, when loan payments resume, 

many borrowers will be at heightened risk of loan delinquency and default that could offset the benefits 

provided by the pause and leave borrowers worse off than they were before the pandemic. Many 

borrowers will experience challenges in the transition back to repayment. Additional steps are needed to 

address these challenges and reduce the likelihood of delinquency and default to ensure that borrowers are 

not in a worse position financially due to the pandemic regarding their ability to repay their loans. As 

detailed below, the Department of Education could mitigate these consequences by taking the following 

steps: 

 Discharging $10,000 of federal student loan balances for borrowers with individual incomes of under 

$125,000 or household incomes of under $250,000 during tax years 2020 or 2021. These discharges 

would be limited to loans that were originally outstanding as of June 30, 2022, and that are currently 

subject to the payment pause, including Direct Loans, Federal Family Education Loans held by the 

Department or by guaranty agencies, and Federal Perkins Loans held by the Department. 

 Discharging an additional $10,000 in federal student debt for borrowers who meet these requirements 

and who also received a Pell Grant at some point in the past. 

This paper summarizes the basis for and key design elements of this proposal and presents relevant 

considerations and evidence. It is not an exhaustive list of all the decisions required to operationalize a 

pandemic-connected loan discharge program, nor is it a complete inventory of all pieces of supporting 

evidence the Department considered. 

II. Analysis 

A. Potential Harm to Borrowers from the Pandemic as Payments Restart 

The student loan payment pause, initiated at the outset of the pandemic, protected borrowers from 

financial harm by allowing them to forgo payments, preventing any interest accrual on their debts, and 

halting all collections on student loans. Despite these measures, many student loan borrowers remain at 

risk of being placed in a worse position financially as a result of the COVID-19 pandemic and its 

associated economic effects. Historical evidence suggests that loans are at heightened risk of delinquency 

and default as they exit forbearance. Economic conditions and surveys of borrowers suggest that, absent 

additional relief, the harmful effects of the pandemic may make repayment more difficult for student loan 

borrowers than it was before the pandemic, especially for lower income borrowers. 

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2 

1. Risk of Delinquency and Default Following Long Periods of Forbearance 

Past experience with student loan borrowers transitioning back into repayment after long periods of 

forbearance raise concerns about the potential for elevated risk of delinquency and default. Although 

there is no exact analogue for the circumstances surrounding the current payment pause, the Department 

has previously provided borrowers experiencing local and regional natural disasters, such as hurricanes, 

earthquakes, or wildfires, with access to forbearances with similar provisions. When borrowers accessing 

natural disaster forbearances transitioned back into repayment, there were documented spikes in student 

loan defaults.1

Analysis of the outcomes of borrowers placed in mandatory administrative forbearances triggered by 

Hurricanes Maria, Harvey, and Irma and the northern California wildfires in late 2017 show that, 

compared to the calendar year before the disaster declaration, the incidence of default increases 

substantially six quarters later. Specifically, only 0.3 percent of borrowers entered default in the calendar 

year before the declaration, while 6.5 percent of borrowers entered default in the calendar year after they 

exited mandatory administrative forbearance.2

 

Furthermore, Pell Grant recipients affected by these events experienced larger increases in default 

compared to non-recipients after exiting mandatory administrative forbearance. While Pell Grant 

recipients and non-recipients had similar probabilities of entering default in the calendar year prior to the 

disaster declaration, 7 percent of Pell borrowers enter default in the calendar year after exiting mandatory 

administrative forbearance compared to 5 percent of non-recipients.3

 

2. Current Economic Conditions Facing Borrowers 

Borrowers themselves report that they will be less likely to keep up with repayments on their student loan 

debt when payments resume, despite benefiting from the repayment pause and stimulus support during 

the course of the pandemic. Among borrowers with income below $125,000 who had also been making 

payments in 2019, a substantially higher number anticipate having trouble making full payments in the 

future than reported not making regular payments before the pandemic. For example, of those with 

income under $40,000. only 26 percent reported never or occasionally making full payments in 2019, but 

51 percent in this group expect to have difficulty making full or even any payments in the future. Of those 

with income between $40,000 and $75,000, 18 percent were unable to make full payments in 2019, but 36 

percent expect to be unable to cover their monthly payments in the future. Similarly, for borrowers with 

income between $75,000 and $125,000, 18 percent reported making occasional or no payments prior to 

the pandemic, but 24 percent expect to make less than full payment when the pandemic forbearance 

ends.4

 

Because borrowers expect increased payment difficulties, even after accounting for the benefits they 

received from the repayment pause and stimulus, it is likely that the net effect of the pandemic—absent 

1

 Kaufman, Ben. "New Data Show Student Loan Defaults Spiked in 2019-A Warning to Industry and DeVos Amid 

Economic Fallout," Student Borrower Prot. Ctr., Mar. 13, 2020. 

2

 Department of Education analysis of administrative data. These analyses are based on borrowers who had at least 

one active Department of Education-held loan, were placed in mandatory administrative forbearance for at least one 

day in the period spanning a week prior to the disaster start date and 90 days after this date, and who had an address 

in a state (and county, when relevant) that was a federally declared disaster area. 3

 Ibid. Information on income is not available for most borrowers placed in mandatory administrative forbearance 

following these federally declared major disasters, thus a similar analysis exploring default rates among borrowers 

with different incomes was not feasible. 

4

 Akana, Tom, and Dubravka Ritter. "Expectations of Student Loan Repayment, Forbearance, and Cancellation: 

Insights from Recent Survey Data." Federal Reserve Bank of Philadelphia, 2022, Table 1. 

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3 

other compensatory actions—would be to increase delinquency rates further. If borrowers’ recollections 

of past repayment success and expectations for future repayment capacity translate directly into their 

future repayment success, borrowers’ delinquency rates will be higher than pre-pandemic levels when 

those compensatory actions end, absent additional relief. 

Research by the Consumer Financial Protection Bureau using credit bureau data provides evidence from 

the balance sheets of student loan borrowers that substantiates the concerns reported by borrowers in the 

above survey. While delinquencies on non-student debt among student loan borrowers dipped during 

2020, delinquencies rose in the second half of 2021, and have since returned to pre-pandemic levels, 

despite the fact that most student loans remained in forbearance.5

 The authors suggest that non-student 

debt delinquencies rose as pandemic interventions were retired. Borrowers who have defaulted on their 

student loans are also more likely to be under water on other types of debt.6

For lower-income student loan borrowers, delinquency rates on non-student loan debt were higher in 

February 2022 than in March 2020 before the start of the pandemic.7

 These rising delinquency rates 

suggests that these borrowers’ student loan delinquency rates also would have risen, had repayments not 

been paused. In fact, we would expect difficulties keeping up with debt payments to be even higher if 

individuals had not received the benefit of the repayment pause and other stimulus support. These 

findings also suggest that, absent additional relief, when the student loan repayment pause ends, student 

loan delinquency rates will follow a similar trajectory as other debt delinquency rates and increase. 

Analyses of credit report data by the Federal Reserve Bank of New York comparing federally owned 

loans (which benefitted from the pause) to federally guaranteed loans and private student loans (which did 

not) concluded that borrowers with commercially held FFEL loans who were not protected by the 

payment pause saw their delinquency rates return to pre-pandemic levels, despite other forms of 

economic support.8

 These borrowers’ delinquency rates would likely have been higher if not for this 

support. The study concluded that, absent further relief, when payments resume, borrowers will likely 

experience increased delinquencies on federal student loans and other types of debt beyond pre-pandemic 

levels.9

 

The rise of inflation to levels not seen in 40 years also creates significant pressures on family budgets and 

thus raises the risk of delinquency and default. Initially, COVID-induced supply-chain disruptions in 

tandem with strong demand for consumer goods led inflation to begin to accelerate in the spring of 2021, 

although other factors (such as Russia’s invasion of Ukraine) have also contributed recently.10 Research 

also suggests that inflationary pressures are most acute for those with lower incomes, particularly as 

prices are rising quickly for basic necessities, including energy, food, and shelter costs.11

5

 Conkling, Thomas S., Christa Gibbs, and Vanessa Jimenez-Read. "Student Loan Borrowers Potentially At-Risk 

When Payment Suspension Ends." Consumer Financial Protection Bureau Office of Research, forthcoming. 

6

 Blagg, Kristin. "Underwater on Student Debt: Understanding Consumer Credit and Student Loan Default." Urban 

Institute, 2018. 

7

 Conkling, Thomas S., Christa Gibbs, and Vanessa Jimenez-Read. "Student Loan Borrowers Potentially At-Risk 

When Payment Suspension Ends." Consumer Financial Protection Bureau Office of Research, forthcoming. 

8

 Goss, Jacob, Daniel Mangrum, and Joelle Scally. “Student Loan Repayment during the Pandemic Forbearance,” 

No. 20220322. Federal Reserve Bank of New York, 2022. 

9

 Ibid. 

10 LaBelle, Jesse, and Ana Maria Santacreu. "Global supply chain disruptions and inflation during the COVID-19 

pandemic." Federal Reserve Bank of St. Louis Review (2022). 11 Argente, David, and Munseob Lee. "Cost of Living Inequality During the Great Recession." Journal of the 

European Economic Association, 19.2, 2021, pp. 913-952. Also see, Larsen, Daryl, and Raven S. Molloy. 

“Differences in Rent Growth by Income 1985-2019 and Implications for Real Income Inequality.” No. 2021-11-05-

3, Board of Governors of the Federal Reserve System (US), 2021. 

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Borrowers who go delinquent or default on their student loans suffer substantial negative penalties. The 

Department reports loans more than 90 days delinquent or in default to the major national credit bureaus, 

which has been shown to be correlated with a 50-to-90-point drop in borrowers’ credit scores.12 These 

notations can remain on borrowers reports for up to seven years, making insurance, rent, and other 

financial products less affordable and hinder borrowers’ ability to get a job.13 Borrowers who default lose 

access to affordable repayment options and flexibilities at the same time their balances become due 

immediately. Additionally, their accounts are subject to collection feeds and involuntary collections like 

wage garnishment, Treasury offset, and litigation. 

B. Pandemic-Connected Loan Discharge Will Reduce These Harms 

1. Discharges Are Likely to Reduce Delinquency and Default Rates 

An immediate discharge of loan balances would mitigate the financial harm caused by the pandemic for 

millions of borrowers by eliminating debt entirely or reducing the monthly payment burden. Balance 

elimination or reduction is likely to reduce delinquency and default and increase short- and long-term 

repayment success. 

Reducing student loan balances can improve borrowers’ ability to repay remaining debts. In a study of the 

effects of private student loan discharges provided to borrowers in default, researchers found that 

following debt discharges of approximately $8,000, borrowers reduced their total liabilities (excluding 

student loans) by more than $4,500.14 Additionally, borrowers were less likely to be delinquent on other 

accounts, file for bankruptcy, be subject to foreclosure, or default on mortgages or medical bills following 

debt relief.15 

Studies of mortgage modifications have shown that reducing monthly payments can have a significant 

ameliorative effect on delinquency and foreclosure: lenders have found that payment reductions of 

between about 20 percent and 30 percent were effective in reducing defaults.16 A study of the JPMorgan 

Chase Institute’s short-term payment reduction program found that every 1 percent of payment reduction 

reduced default rates by about 1 percent.17

Loan discharges can reduce delinquency and default risks even though borrowers have other options to 

reduce monthly payments, like income-driven repayment (IDR) plans. Many borrowers who are eligible 

for IDR plans are not yet enrolled. Recent research from the JPMorgan Chase Institute, for instance, 

showed that 22 percent of their sample were eligible for IDR but not enrolled.18 The Federal Reserve 

Bank of Philadelphia’s survey study notes that lower-income individuals were much less likely to expect 

12 Blagg, Kristin. "Underwater on Student Debt: Understanding Consumer Credit and Student Loan Default." Urban 

Institute, 2018. 

13 Elliott, Diana and Ricki Granetz Lowitz. "What Is the Cost of Poor Credit?." Urban Institute, 2018; Corbae, Dean, 

Andrew Glover, and Daphne Chen. "Can Employer Credit Checks Create Poverty Traps?" 2013 Meeting Papers, 

No. 875, Society for Economic Dynamics, 2013. 

14 Di Maggio, Marco, Ankit Kalda, and Vincent Yao. “Second Chance: Life Without Student Debt.” No. w25810, 

National Bureau of Economic Research, 2019. 

15 Ibid. 

16 An, Xudong, et al. “Inequality in the Time of COVID-19: Evidence from Mortgage Delinquency and 

Forbearance.” No. 21-09, Federal Reserve Bank of Philadelphia, 2021. 17 Ganong, Peter, and Pascal Noel. "Liquidity versus wealth in household debt obligations: Evidence from housing 

policy in the great recession." American Economic Review, 110.10, 2020, pp. 3100-3138. 18 Greig, Fiona and Daniel M. Sullivan. “Income Driven Repayment: Who Needs Student Loan Payment Relief?”,

JP Morgan Chace Institute, June 2022. 

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to make full payments notwithstanding the existence of IDR plans.19 The visibility of a student loan 

discharge program, combined with the clear benefit to borrowers, will likely attract these borrowers to 

apply in numbers that FSA’s efforts to increase enrollment in IDR have not. 

Loan discharge may also indirectly reduce delinquency and default rates. The Department intends to use 

the attention generated by loan discharges, and the likely applications filed by millions of borrowers, to 

encourage borrowers to take advantage of other federal repayment benefits and protections like IDR. 

Borrowers using income-driven repayment plans have significantly lower rates of default and delinquency 

than borrowers who do not use those plans.20 The loan cancellation process will also require borrowers to 

provide updated contact information that will improve targeted communications and interventions toward 

borrowers at risk delinquency and default. An Urban Institute scholar recently recommended a similar 

approach, making loan cancellation contingent on borrowers restarting payments, for similar reasons.21

2. Amount of Debt to Discharge 

Given the Department’s goals, it should discharge an amount of debt necessary to significantly decrease 

the rates of delinquency and default. Although discharging the entire loan amount would permanently 

avoid this harm, lesser discharge amounts will mitigate the risk that delinquency and default rates will rise 

above pre-pandemic levels. 

If the Department forgave up to $20,000 in debt, the Department estimates that if all borrowers claimed 

the relief they were entitled to, approximately 20 million borrowers would have their loan eliminated 

entirely.22 Borrowers with low balances tend to have lower incomes and higher default rates.23 Thus, lowbalance borrowers are at particular risk of being in a worse financial position because of the pandemic 

absent further relief. 

Department estimates suggest that, if all borrowers claimed the benefits to which they are entitled, an 

additional 23 million borrowers would see their balances reduced, with median debt falling from $29,400 

to $13,600.24 The Department would reamortize borrowers’ remaining balances to reduce monthly 

payments after applying the discharge. 

The Department estimates the payment pause has saved the average borrower in repayment 

approximately $233 a month.25 Among vulnerable borrowers, a similar $200 to $300 reduction in 

monthly payments could be achieved by the proposal. As a result, for many borrowers, the balance 

reduction provided by discharge would reduce monthly payments at similar levels to the relief provided 

during the pause. For example, for a hypothetical borrower midway through loan repayment, the 

19 Akana, Tom, and Dubravka, Ritter. "Expectations of Student Loan Repayment, Forbearance, and Cancellation: 

Insights from Recent Survey Data." Federal Reserve Bank of Philadelphia, 2022, Table 1. 20 Conkling, Thomas S., and Christa Gibbs. "Borrower experiences on income-driven repayment." Consumer 

Financial Protection Bureau Office of Research Reports Series, 19-10, 2019. 21 Chingos, Matthew. "How Forgiveness Could Support the Student Loan Restart." Urban Institute, 2022. 22 Department of Education estimates using administrative federal student aid data and imputed income from Census 

data. 

23 Scott-Clayton, Judith. “The looming student loan default crisis is worse than we thought.” Brookings Institution 

Evidence Speaks Reports, Vol. 2, #34, 2018; Looney, Adam, and Constantine Yannelis. "A crisis in student loans?: 

How changes in the characteristics of borrowers and in the institutions they attended contributed to rising loan 

defaults." Brookings Papers on Economic Activity, 2015, no. 2, 2015, pp. 1-89. 24 Department of Education estimates using administrative federal student aid data and imputed income from Census 

data. 

25 Department of Education estimates using administrative federal student aid data. 

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estimated reduction in median balances from $29,400 to $13,600 would result in an approximately $300 

reduction in monthly payments.26 

Studies of mortgage modification programs have shown that payment reductions of between 20 and 30 

percent are effective at reducing the rate of delinquency.27 Using administrative data, the Department 

estimates that if all borrowers claimed the benefits to which they were entitled, among borrowers who do 

not receive full forgiveness, a maximum benefit of $10,000 in cancellation would lead to a median 

reduction in payments of 31 percent, while a maximum benefit of $20,000 in cancellation (where the 

additional relief is only available to Pell recipients) would lead to a median reduction in payments of 38 

percent.28 

C. Borrower and Loan Eligibility 

3. Borrower Income Threshold 

Many borrowers have been harmed by the pandemic and may be at greater risk of delinquency or default 

than they were before the pandemic. However, not all borrowers are equally at risk of these outcomes. 

Research shows that student loan repayment is correlated with income, and lower income borrowers are 

more likely to experience delinquency and default.29 

Borrowers who are either individuals with incomes under $125,000 or belong to households with incomes 

under $250,000 are more likely than individuals above those thresholds to experience financial hardship 

in making payments on their loans when payments resume. 

26 Specifically, a borrower on the standard 10-year plan with an original balance of $29,400, a 5 percent interest rate, 

and five years of payments remaining would see these benefits 

27 An, Xudong, et al. “Inequality in the Time of COVID-19: Evidence from Mortgage Delinquency and 

Forbearance.” No. 21-09, Federal Reserve Bank of Philadelphia, 2021; Ganong, Peter, and Pascal Noel. "Liquidity 

versus wealth in household debt obligations: Evidence from housing policy in the great recession." American 

Economic Review, 110.10, 2020, pp. 3100-3138. 28 These estimates would apply to a borrower who receives forgiveness but does not have their balance fully 

discharged and who has made their scheduled payments on the 10-year standard repayment plan since entering 

repayment. 

29 Looney, Adam, and Constantine Yannelis. "A crisis in student loans?: How changes in the characteristics of 

borrowers and in the institutions they attended contributed to rising loan defaults." Brookings Papers on Economic 

Activity, 2015, no. 2, 2015, pp. 1-89. 

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Inconsistent Payments 

Evidence from the Federal Reserve Bank of Philadelphia’s Consumer Finance Institute COVID-19 Survey 

of Consumers establishes the $125,000 income mark as a reasonable ceiling for discharge eligibility. As 

would be expected, borrowers with lower incomes have a lesser ability to make consistent payments on 

their loans. The survey shows that borrowers with incomes between $100,000 and $124,000 have rates of 

payment inconsistency – that is, the percentage of respondents who reported making no or “occasional” 

payments for their loans in 2019 – that are nearly double what they are for those with incomes between 

$125,000 and $149,000 (see Figure 1). 

Rates of regular repayment for borrowers earning $125,000 or above are roughly 14 percentage points (or 

20%) above what they are for those earning between $100,000-$124,000.30 This suggests that the average 

borrower earning above $125,000 entered the pandemic on firmer financial footing with regards to loan 

payments, relative to those earning below the eligibility ceiling (see Figure 2). 

30 Analyses based on unpublished data provided by the Federal Reserve Bank of Philadelphia. 

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Future Payment Capacity 

Lower-income borrowers are less likely to report being able to repay future loans, an indicator of risk of 

delinquency or default. There is a break in repayment capacity at around $125,000. After forbearance, 

nearly 20 percent of borrowers earning between $100,000 and$124,000 expect to experience difficulty 

repaying loans, compared to 14 percent of those earning above $125,000 (see Figure 3). 

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Financial Security 

The financial insecurity of those with student loans falls as income rises, declining particularly steeply 

above $125,000. Financial insecurity rates for borrowers with incomes between $100,000 and $124,000 

are more than double those for borrowers with incomes between $125,000 and $149,000. Education loan 

holders with incomes exceeding the discharge eligibility ceiling report more positive sentiments 

concerning their financial security: only about 10 percent of borrowers with incomes greater than 

$125,000 report financial insecurity (see Figure 4).31 

 

31 Ibid. 

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Income and the Pandemic 

Survey data indicates that lower-income workers were disproportionately likely to become unemployed in 

the beginning of the pandemic.32 In the summer of 2021, a Brookings analysis found that low-wage 

earners were overrepresented among “displaced” workers (workers on “permanent” layoff, meaning they 

lost their jobs and were not called back).33 A rich economic literature indicates that such unemployment 

can have long-term scarring effects.34 Students who left school in 2020 and 2021 are also projected to 

experience significant reductions in lifetime earnings.35

Because of this pattern of job loss, lower-income households also experienced greater material hardship 

due to the pandemic.36 Compared with adults whose family employment was unaffected by the pandemic, 

they were twice as likely to report food insecurity, nearly three times as likely to report problems paying 

utility bills, and nearly four times as likely to report problems paying the rent or mortgage. 

32 Adams-Prassl, Abi, et al. "Inequality in the Impact of the Coronavirus Shock: Evidence from Real Time Surveys." 

Journal of Public Economics, 189, 104245, 2020; Despard, Mathieu, et al. “Covid-19 Job and Income Loss Leading 

to More Hunger and Financial Hardship.” Brookings, 9 Mar. 2022. 

33 Bateman, Nicole, and Martha Ross. "The pandemic hurt low-wage workers the most and so far, the recovery has 

helped them the least." Brookings, 2021. 

34 Mroz, Thomas A., and Timothy H. Savage. "The Long-term Effects of Youth Unemployment." Journal of Human 

Resources, 41.2, 2006, pp. 259-293; Kahn, Lisa B. "The long-term labor market consequences of graduating from 

college in a bad economy." Labour economics, 17.2, 2010, pp. 303-316; Schwandt, Hannes, and Till Von Wachter. 

"Unlucky cohorts: Estimating the long-term effects of entering the labor market in a recession in large crosssectional data sets." Journal of Labor Economics, 37.S1, 2019, pp. S161-S198. 35 Friedman, John. “Lifetime Earnings Effects of the COVID-19 Recession for Students.” Opportunity Insights 

Economic Tracker (2021). 

36 Karpman, Michael, and Stephen Zuckerman. "Average Decline in Material Hardship During the Pandemic 

Conceals Unequal Circumstances." Urban Institute, 2021. 

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A literature review from the Department of Health and Human Services highlighted the disproportionate 

job losses for low-wage workers and the wide-reaching impacts of job loss on material hardship and food 

insecurity.37 The review emphasizes that among low-wage workers, women and people of color were 

disproportionately impacted. The review notes that many COVID-19 relief measures initially missed, or 

were insufficient for, low-income families. 

4. Past Pell Receipt 

A disproportionate number of Pell Grant borrowers are low-income. An analysis of Pell Grant borrowers 

for whom the Department has income information (from a FAFSA application or an IDR application) 

suggests that 99 percent of Pell Grant recipients have incomes below $125,000.38 

Borrowers’ status as former Pell recipients provides independent and valuable measures of their risk of 

delinquency and default, even in addition to current income. Rather than evaluating a borrower’s current 

income, Pell Grant eligibility is based upon a broader set of data intended to be a more complete measure 

of family financial resources at the time of application. Because Pell Grant eligibility is determined on 

the basis of financial need, recipients typically have lower wealth and familial monetary resources at the 

time of receiving the grant. 

37 US Department of Health and Human Services, “The Impact of the First Year of the COVID-19 Pandemic and 

Recession on Families with Low Incomes.” 2021. 

38 Department estimates using administrative data on Pell Grant borrowers who submitted a FAFSA or IDR 

application with 2020 or 2021 income information. 

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Borrowers who received a Pell Grant in the past are at greater risk of delinquency and default, regardless 

of current income. Forty-two percent of Pell recipients default on their loans at least once, compared to 

just 18 percent of borrowers who never received a Pell Grant – a 24 percentage point difference. The 

relationship holds even when controlling for a borrower’s imputed income. Indeed, at every band of 

imputed income, Pell Grant recipients are roughly twice as likely to default on their loans as non-Pell 

students.39

Moreover, the default rates for Pell Grant recipients with lower imputed income are especially high, with 

at least one in three Pell recipients in every imputed income band below $125,000 defaulting at least 

once. For borrowers with imputed incomes between $100,000 and $125,000, 32 percent of Pell Grant 

recipients default at least once, compared to 13 percent of non-Pell Grant recipients.40

Among enrolled students, Pell Grant recipients were disproportionately likely to be financially harmed by 

the pandemic. One recent study found that enrolled Pell Grant recipients were 20 percent more likely to 

lose a job during the pandemic, 17 percent more likely to see a drop in earnings, and 65 percent more 

likely to report facing food and housing insecurity than students who never received a Pell grant.41

Past experience suggests that past Pell recipients also struggle with their student loans at higher rates than 

their peers. A study that focused on borrowers who entered repayment before and after the Great 

Recession showed that Pell Grant recipients saw larger declines in repayment rates than non-Pell 

recipients.42 As noted above, Pell Grant recipients also saw larger increases in default rates following 

recent natural disaster forbearances. 

5. Parental Income for Dependent Students 

The federal government has long considered parents’ resources in allocating financial aid for enrolled 

dependent students. For example, under the Higher Education Act, parental income is a factor in 

dependent student borrowers’ eligibility for financial aid, including student loans. Congress has long 

varied the origination terms of certain loans based upon families’ ability to repay by providing subsidized 

student loans. 

While current income is an effective indicator of former students’ capacity to repay, it is not adequate to 

assess current students’ ability to repay because most current students have low incomes. In this context, 

the Higher Education Act has long recognized that family income is a better indicator of capacity to repay 

because it is strongly correlated with children’s expected income. 

Each year, between 4 and 5 million borrowers enter repayment for the first time.43 The pandemic has also 

caused additional borrowers to separate from school and enter repayment.44 In fact, hundreds of thousands 

of borrowers leave mid-way through the semester or do not re-enroll the next semester. Additionally, 

around 300,000 borrowers make payments on their loans while they are in school.45 Altogether, there is a 

39 Department of Education estimates using administrative federal student aid data and imputed income from Census 

data. 

40 Ibid. 

41 Rodríguez-Planas, Núria. "Hitting Where It Hurts Most: COVID-19 and Low-Income Urban College Students." 

Economics of Education Review, 87, 102233, 2022. 42 Blagg, Kristin and Erica Blom. “Student debt repayment fell during the Great Recession. Borrowers from lowincome backgrounds saw the steepest decline.” Urban Institute, 2018. 

43 US Department of Education, “Digest of Education Statistics 2021.” 2021, Table 332.50. 

44 Saul, Stephanie. “College Enrollment Drops, Even as the Pandemic's Effects Ebb.” The New York Times, 26 May 

2022. 

45 Based on analysis of 2019 FSA student loan data. 

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significant population of borrowers who were enrolled last year but will nonetheless be impacted by 

resumption of payments. 

6. Limitation to Existing Loans 

The proposal would apply to loans that were outstanding on June 30, 2022, the end of the 2022-23 

academic year. The terms of financial aid policies – such as the interest rate on new student loans and the 

maximum Pell grant – typically change each July 1. Moreover, extending eligibility into the new 

academic year risks generating incentives to borrow additional loans in anticipation of cancellation. It 

would also create arbitrary results based upon a school’s academic schedule, the efficiency of its financial 

aid office, and the order in which it processed a particular student’s financial aid awards. 

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Exhibit B 

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Exhibit C 

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DATE: 

MEMORANDUM TO: 

FROM: 

SUBJECT: 

THE SECRETARY OF EDUCATION 

WASHINGTON, DC 20202 

September 27, 2022 

Dr. Nasser Paydar 

Assistant Secretary for Postsecondary Education 

Richard Cordray 

Chief Operating Officer 

Federal Student Aid 

Miguel A. Cardona, Ed.D. . A~/ 

Secretary of Education ~ 

Waivers Relating to Pandemic-Connected General Loan Discharge 

On August 24, 2022, I notified Richard Cordray, Chief Operating Officer of Federal Student Aid, 

that I had determined to exercise my discretion under the HEROES Act to issue waivers and 

modifications necessary to (1) discharge up to $20,000 in federal student loan balances for 

borrowers who meet certain conditions and (2) take all administrative steps necessary to 

implement that determination. 

In the interim, the Department has developed a comprehensive strategy to implement that 

determination. As such, today I am issuing waivers and modifications to the provisions of 20 

U.S.C. 1087, which applies to the Direct Loan Program under 20 U.S.C. 1087a and 1087e; 20 

U.S.C. 1087dd(g); and 34 CFR part 674, subpart D, §§ 682.402 and 685.212 to provide that, 

notwithstanding any other statutory or regulatory provision, the Department will discharge the 

balance of a borrower's loans up to a maximum of: (a) $20,000 for borrowers who qualified for 

Pell Grants at the time they received the loans and had an Adjusted Gross Income ("AGI") below 

$125,000 for an individual taxpayer or $250,000 for borrowers filing jointly or as a Head of 

Household for the 2020 or 2021 Federal tax years; or (b) up to a maximum of $10,000 for 

borrowers who are eligible under those income thresholds but did not qualify for a Pell Grant at 

the time they received the loans. This waiver is applicable to borrowers with outstanding Direct 

Loans, FFEL loans held by the Department or subject to collection by a guaranty agency, and 

Perkins Loans held by the Department prior to July 1, 2022, and who are determined to be 

eligible by the Department. 

Please take all necessary actions to implement these waivers and modifications and to provide 

notice of these waivers and modifications in the Federal Register. 

400 MARYLAND AVE., S.W., WASHINGTON, DC 20202 

www.ed.gov 

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Exhibit D 

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FSA Content

Copywriter: Laura Nadel

SME:

Date: August 30, 2022

Release:  

Page 1

COPYDOC

0.4.66.1 One‐Time Student Loan Debt Relief

PAGE TITLE (browser

tab/breadcrumbs)

One‐Time Student Loan Debt Relief

URL https://studentaid.gov/debt‐relief‐announcement/one‐time‐

cancellation

Vanity URL (if any) N/A

LOCATION https://studentaid.gov/debt‐relief‐announcement

INVISION LINK

PAGE GOAL Provide borrowers with additional details about one‐time loan debt

relief

TARGET (Persona) college student, college grad, graduate student, parent borrower

KEYWORDS/PHRASES loan, loans, forgiveness, discharge, income, debt, relief, cancellation,

Biden debt relief plan, loan forgiveness, loan cancellation

META DESCRIPTION (155

characters max)

You can get up to $20,000 of one‐time federal student loan debt

relief.

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CONTENT

H1 (Headline)   

One‐Time Student Loan Debt Relief   

BODY   

On Aug. 24, 2022, the Biden‐Harris Administration announced a Student Debt

Relief Plan that includes one‐time student loan debt relief targeted to low‐ and

middle‐income families.  

https://studentaid.gov/debt‐

relief‐announcement/

The U.S. Department of Education (ED) will provide up to $20,000 in debt relief

to Federal Pell Grant recipients and up to $10,000 in debt relief to non‐Pell Grant

recipients. Borrowers with loans held by ED are eligible for this relief if their

individual income is less than $125,000 (or $250,000 for households).  

H2

What Do I Need to Know?    

CARD   

H3

An online form will be available by Earlyin October 2022. Here are some steps

you can take now and in the future.

H4

Step 1: Check if you’re eligible  

BODY   

You’re eligible for student loan debt relief if your annual federal income was

below $125,000 (individual or married, filing separately) or $250,000 (married,

filing jointly or head of household) in 20201 or 20210.  

 $20,000 in debt relief: If you received a Pell Grant in college and meet

the income threshold, you’ll be eligible for up to $20,000 in debt relief.   

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 $10,000 in debt relief: If you did not receive a Pell Grant in college and

meet the income threshold, you’ll be eligible for up to $10,000 in debt

relief.  

H4

Step 2: Prepare  

BODY   

Here’s what you can do to get ready and to make sure you get our updates:  

 Log in to your account on StudentAid.gov and make sure your contact

info is up to date. We’ll send you updates by both email and text

message, so make sure to sign up to receive text alerts. If it’s been a

while since you’ve logged in, or you can’t remember if you have an

account username and password (FSA ID), we offer tips to help you

access your account.  

 If you don’t have a StudentAid.gov account (FSA ID), you should create

an account to help you manage your loans.   

 Make sure your loan servicer has your most current contact information

so they can reach you. If you don’t know who your servicer is, you can

log in and see your servicer(s) in your account dashboard.

 To be notified when the process has officially opened, sign up at the

Department of Education subscription page.

  

https://studentaid.gov/fsa‐

id/sign‐

in/landing/?redirectTo=/settings/

edit‐information/contact‐

information

https://studentaid.gov/fsa‐

id/sign‐

in/landing/?redirectTo=/settings/

edit‐information/communication‐

preferences

https://studentaid.gov/help‐

center/answers/article/help‐

accessing‐account‐fsa‐id

https://studentaid.gov/fsa‐

id/create‐account

https://studentaid.gov/fsa‐

id/sign‐

in/landing/?redirectTo/=dashboar

d

https://www.ed.gov/subscriptions

H4

Step 3: Submit your application (when available)    

BODY

The application will be available online by earlyin October 2022.  

We’ll share updates on this page and send you an email when the application is

available. You’ll have until Dec. 31, 2023, to submit your application.  

H2

Federal Pell Grants   

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CARD   

H3

How Do I Know If I Ever Received a Federal Pell Grant?  

BODY

Federal Pell Grants typically are awarded to undergraduate students with low or

moderate income.

Most borrowers can log in to StudentAid.gov to see if they received a Pell Grant.

We display information about the aid you received, including Pell Grants, on

your account dashboard and your “My Aid” pages.

Log In to Your Account   https://studentaid.gov/fsa‐

id/sign‐in/landing

When you apply for debt relief, we’ll make sure all borrowers who received a

Pell Grant receive the full benefit of up to $20,000 in relief if they meet the

income requirements. ED has data on all borrowers who received a Pell Grant. If

you received a Pell Grant prior to 1994, that information won’t display in

StudentAid.gov, but you’ll still receive the full benefit.

FAQ (ACCORDION)   

If I have a Pell Grant, do I need to do anything to get the full $20,000 in debt

relief?  

BODY   

Yes. You just need to submit your application for debt relief. We have a record of

every student who has ever received a Federal Pell Grant. When you submit your

application, we’ll check our records to determine if you have a Pell Grant, which

would qualify you for up to $20,000 in debt relief. You don’t need to take any

additional action to show us that you received a Pell Grant.

FAQ (ACCORDION)   

Do I still qualify for the full $20,000 in debt relief if I received only one Pell

Grant?

BODY   

Yes. As long as you received at least one Pell Grant of any amount, you qualify

for the additional $210,000 in debt relief. This additional $10,000debt relief will

be applied to eligible loans, such as undergraduate, graduate, or parent loans. It

doesn’t matter if the Pell Grant was used for the same program of study or at

the same school as your federal student loan(s).

FAQ (ACCORDION)   

If I have parent PLUS loans and my child received a Pell Grant, can the my

child’sfull $20,000 in debt relief be applied to my parent PLUS loans?

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BODY   

No. The debt relief will be applied only to your child’s loan(s)Eligibility for debt

relief is based on each borrower’s situation.  

If a dependent student received a Pell Grant, up to $20,000 in debt relief will be

applied to the student’s loans—not to any loans their parent may have taken

out.   

A parent who has taken out loans—including loans for their own studies or

parent PLUS loans for their child—may qualify for debt relief if they meet the

income eligibility criteria. If a parent also received a Pell Grant for their own

studies, then the parent borrower may be eligible for up to $20,000 in relief on

their loans. Otherwise, the parent borrower may be eligible for up to $10,000 in

debt relief.

H2

Which Loans Are Eligible?    

BODY

The following types of federal student loans with an outstanding balance as of

June 30, 2022, are eligible for relief:

 William D. Ford Federal Direct Loan (Direct Loan) Program loans

 Subsidized loans

 Unsubsidized loans

 Parent PLUS loans

 Graduate PLUS loans

 Federal Family Education Loan (FFEL) Program loans held by ED or in

default at a guaranty agency

 Federal Perkins Loan Program loans held by ED

 Defaulted loans (includes ED‐held or commercially serviced Subsidized

Stafford, Unsubsidized Stafford, parent PLUS, and graduate PLUS; and

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Perkins loans held by ED)

Consolidation loans are eligible for relief, as long as all of the underlying loans

that were consolidated were first disbursed on or before June 30, 2022.

This means that subsidized loans, unsubsidized loans, pParent PLUS loans, and

gGraduate PLUS loans held by ED are eligible. Consolidation loans are also

eligible for relief, as long as all of the underlying loans that were consolidated

were ED‐held loans and were disbursed on or before June 30, 2022. Additionally,

consolidation loans comprised of any FFEL or Perkins loans not held by ED are

also eligible, as long as the borrower applied for consolidation before Sept. 29,

2022.  

FAQ (ACCORDION)   

How do I know what kinds of loans I have?    

BODY

You can identify your loan types by logging on to StudentAid.gov and selecting

“My Aid” in the dropdown menu under your name. In the “Loan Breakdown”

section, you’ll see a list of each loan you received. You’ll also see loans you paid

off or consolidated into a new loan. If you expand “View Loans” and select the

“View Loan Details” arrow next to a loan, you’ll see the more detailed name for

that loan.  

Direct Loans begin with the word “Direct.” Federal Family Education Loan

Program loans begin with “FFEL.” Perkins Loans include the word “Perkins” in

the name. If the name of your servicer starts with “Dept. of Ed” or “Default

Management Collection System,” your FFEL or Perkins loan is federally managed

(i.e., held by ED).  

The “My Aid” section will also show you the servicer(s) for your loans.    

FAQ (ACCORDION)

Are defaulted loans eligible for debt relief?    

BODY

Yes, defaulted loans are eligible for debt relief. If you have a remaining balance

on your defaulted loan(s) after relief is applied, consider getting or staying out of

default through the Fresh Start initiative.   

https://studentaid.gov/announce

ments‐events/default‐fresh‐start

FAQ (ACCORDION)

Are private loans (i.e., non‐federal loans) eligible for debt relief?    

BODY

No. Private (non‐federal) loans are not eligible for debt relief. If you consolidated

federal loans into a private (non‐federal) loan, the consolidated private loan is

Commented [WR1]: Please double check this in the 

final final 

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not eligible for debt relief.  

FAQ (ACCORDION)

Are parent PLUS loans and graduate PLUS loans eligible for debt relief?    

BODY

Yes. All ED‐held loans, including PLUS loans for parents and graduate students,

are eligible for relief.

FAQ (ACCORDION)

Are Federal Family Education Loans (FFEL) Program loans or Perkins Loans

eligible for debt relief?  

BODY

All loans eligible for the student loan payment pause are also eligible for relief,

including loans held by ED and guaranty agencies.

As of Sept. 29, 2022, borrowers with privately held federal student loans not

held by ED cannot obtain one‐time debt relief by consolidating those loans into

Direct Loans.

Borrowers with privately owned FFEL Program loans and Perkins Loans not held

by ED who have applied to consolidate into the Direct Loan program prior to

Sept. 29, 2022 are eligible for one‐time debt relief through the Direct Loan

program.  

ED is assessing whether to provide relief to borrowers with privately

owned federal student loans, including FFEL and Perkins Loans, and is

discussing this with private lenders. In the meantime, borrowers with

privately held federal student loans can receive this relief by consolidating

these loans into the Direct Loan program. All eligible borrowers will have

until Dec. 31, 2023 to submit an application for debt relief.

ED is assessing whether there are alternative pathways to provide relief to

borrowers with privately owned federal student loans not held by ED, including

FFEL Program loans and Perkins Loans, and is discussing this with private lenders.

FFEL Joint Consolidation Loans, often referred to as spousal consolidation loans,

are not eligible for consolidation into the Direct Loan program under current

law.

H2

Frequently Asked Questions (FAQs)  

H3

General Info About Debt Relief  

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FAQ (ACCORDION)

How can I find out how much debt relief I’ll get?  

BODY

If you meet the income requirements and have eligible loans, the amount of

your debt relief will depend on your outstanding balance and whether you

received a Federal Pell Grant.  

 If you received a Pell Grant, you can receive up to $20,000 in debt relief.   

 If you didn’t receive a Pell Grant, you can receive up to $10,000 in debt

relief.  

If your outstanding loan balance is less than the maximum amount of debt relief

you’re eligible for, you’ll receive relief only of your full loan balance.   

The application for debt relief will be available in October 2022. Once you submit

your application, we’ll determine your relief amount.

FAQ (ACCORDION)

What will I need to complete the application?

BODY

The application will be a short online form. You won’t need your FSA ID, and you

won’t need to upload any documents to submit your application. Our goal is to

provide borrowers a seamless and simple experience, and we’re working closely

with the servicers who will process the relief.

If your outstanding loan balance is less than the maximum amount of debt relief

you’re eligible for, you’ll receive only relief of your full loan balance.   

The application for debt relief will be available in October 2022. Once you submit

your application for debt relief, we’ll determine your relief amount.

FAQ (ACCORDION)

How will I know when debt relief has been applied to my account?    

BODY

Your loan servicer will notify you when the relief has been applied to your

account, with details on how the relief was applied.

FAQ (ACCORDION)

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What happens if I still have a loan balance after debt relief is applied?    

BODY

Loan balances remaining after relief will be re‐amortized, meaning we will

recalculate your monthly payment based on your new balance, potentially

reducing your monthly payment. Your loan servicer will communicate your new

payment amount to you.  

FAQ (ACCORDION)

Am I eligible for a refund if I made voluntary payments during the pandemic?

BODY

Yes. You will automatically receive a refund of your payments during the

payment pause if:

 you successfully apply for and receive debt relief under the

Administration’s debt relief plan, AND

 your voluntary payments during the payment pause brought

your balance below the maximum debt relief amount you’re

eligible to receive but did not pay off your loan in full.

For example, if you’re a borrower eligible for $10,000 in relief;

had a balance of $10,500 prior to March 13, 2020; and made

$1,000 in payments since then—bringing your balance to $9,500

at the time of discharge—we’ll discharge your $9,500 balance,

and you’ll receive a $500 refund.  

Other borrowers can still receive refunds on voluntary payments made

after March 13, 2020, by contacting their servicer. It’s important to note

that these refunded payments will increase your loan balance and your

monthly payments. If you expect to have a balance after discharge is

applied and wish to request a refund, you can do so by contacting your

servicer until Dec. 31, 2023.  

If you consolidated your loan after March 13, 2020, refunds aren’t

available for any voluntary payments made prior to the consolidation.

Refund requests can only be made by you and refunded to you, even if someone

else made a payment on your loan.

FAQ (ACCORDION)

Do I have to be repaying my loans to be eligible for debt relief?    

BODY

No. Borrowers are eligible for debt relief regardless of whether they’re in

repayment, in school, or in grace, as long as they meet the income requirements

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and have eligible loans.  

FAQ (ACCORDION)

If I have multiple loans, can I pick which loans get the relief?    

BODY

We’ll determine how debt relief gets applied to your loans. See the next

FAQbelow for additional details. Federal Student Aid will make this

determination andWe’ll then provide the guidance to loan servicers, who will

then process the relief. See below for additional details.

FAQ (ACCORDION)

How will debt relief be applied to my loans?    

BODY

For borrowers with multiple loans, we’ll apply the relief in the following order:    

 Defaulted ED‐held loans   

 Defaulted commercial FFEL Program loans  

 Non‐defaulted Direct Loan Program loans and FFEL Program loans held

by ED  

 Perkins Loans held by ED  

If you have multiple loans in a program type (e.g., multiple Direct Loan Program

loans), we’ll apply the relief in the following order:   

 Apply relief to loans with highest statutory interest rate.  

 If interest rates are the same, apply to unsubsidized loans prior to

subsidized loans.  

 If interest rate and subsidy status are the same, apply to the most recent

loan.  

 If interest rate, subsidy status, and disbursement date are the same,

apply to the loan with the lowest combined principal and interest

balance.  

FAQ (ACCORDION)

Will my debt relief be taxed?    

BODY

One‐time student loan debt relief will not be subject to federal income taxes.

State and local tax implications will vary.

For most borrowers, you will only receive debt relief only if you submit an

application. But some borrowers may be eligible for relief without applying. If

you would like to opt out of debt relief for any reason—, including because you

are concerned about a state tax liability—, you will be given an opportunity to

opt out. (See below, “What if I don’t want to receive debt relief?”).

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FAQ (ACCORDION)

How do I get help if I have questions or need assistance?    

BODY

We’ll continue to update this page as we have more details. The program

information you can read here is the same information our contact center

agents have at this time. After the online application is live, support for the form

will be available at 1‐833‐932‐3439.  

H3

Applying for Debt Relief   

FAQ (ACCORDION)

Will any borrowers receive debt relief without applying?    

BODY

Although most borrowers will have to apply for debt relief, we have income data

on hand for around 8 million borrowers. These borrowers will get the relief

without applying, unless they choose to opt out (see below, “What if I don’t

want to receive debt relief?”).  

FAQ (ACCORDION)   

How will I know if I qualify for debt relief without applying?    

BODY

If we determine that you qualify for debt relief without applying, we’ll send you

an email and text message (if you’re signed up for text alerts). You don’t have to

take any action, unless you would like to opt out (see below, “What if I don’t

want to receive debt relief?”). We’ll provide your information to your loan

servicer to process your relief.  

We’ll use Free Application for Federal Student Aid (FAFSA®) and income‐driven

repayment application information to identify borrowers—or, as appropriate,

parents—who have submitted income data for tax years 20201 or 20210. We’ll

use this data to determine which borrowers meet the income requirements. If

we have borrower data for both years, we’ll use the year with the lower income.  

FAQ (ACCORDION)

I’m a dependent student. Do I apply based on my income or my parents’ income?

BODY

If you were enrolled in school as a dependent student for financial aid purposes

between July 1, 2021, and June 30, 2022, then your eligibility is based on parent

income. After you fill out your own application form, we’ will contact you so your

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parent can complete a Parent Income Form.

FAQ (ACCORDION)

When will the online application be available?    

BODY

The online application will be available by earlyin October 2022.  

FAQ (ACCORDION)

How do I know if you received my application?    

BODY

When you submit your application for debt relief, you’ll see a page online

confirming your form was submitted. You’ll also get a confirmation email from

us, so make sure we have your most current email address. You can log in to

StudentAid.gov and review your contact information.  

https://studentaid.gov/fsa‐

id/sign‐in/landing/?redirectTo=/

settings/edit‐information/contact‐

information

FAQ (ACCORDION)

What happens if I applied for Public Service Loan Forgiveness (PSLF)?    

BODY

We’ll identify any borrower who submitted both an application for one‐time

student loan debt relief and a PSLF form. If you receive one‐time student loan

debt relief and are then determined to have been eligible for forgiveness under

PSLF, we’ll adjust your loan and apply the PSLF discharge. The PSLF discharge

may provide a refund on certain eligible payments made after the borrower has

already made 120 payments.  

FAQ (ACCORDION)

How long do I have to apply for debt relief?    

BODY

You’ll have from October 2022 until Dec. 31, 2023, to submit your application for

student loan debt relief.

FAQ (ACCORDION)

Is there a paper version of the debt relief application?    

BODY

Initially, the application will be available only online. A paper version of the form

will be made available at a future date, and you’ll have until Dec. 31, 2023, to

apply.

FAQ (ACCORDION)   

What if I don’t want to receive debt relief?

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BODY   

For most borrowers, you will only receive debt relief only if you submit an

application. But if you completed a Free Application for Federal Student Aid

(FAFSA®) form for the 2022–23 school year or are enrolled in an income‐driven

repayment plan based on your 2020 or 2021 income, you may be eligible for

relief without applying. If you would like to opt out of debt relief for any

reason—, including because you are concerned about a state tax liability—, you’

will be given an opportunity to opt out.

H2

Beware of Scams   

FEATURE BOX

You might be contacted by a company saying they will help you get loan

discharge, forgiveness, cancellation, or debt relief for a fee. You never have to

pay for help with your federal student aid. Make sure you work only with ED and

our trusted partnersloan servicers, and never reveal your personal information

or account password to anyone. Our emails to borrowers come from

noreply@studentaid.gov, noreply@debtrelief.studentaid.gov, andor

ed.gov@public.govdelivery.com. You can report scam attempts to the Federal

Trade Commission by calling 1‐877‐382‐4357 or by visiting reportfraud.ftc.gov.

https://reportfraud.ftc.gov/#/

[Feature box continues]

CTA link H4 (in feature box)

Learn how to avoid scams and what you can do if you’re contacted by a

scammer.  

https://studentaid.gov/resources/

scams

[Feature box ends]

H2

Get Support   

BODY

We’ll continue to update this page as we have more details. At this time, our

contact center agents have the same information you can read here. After the

online form is live, support for the form will be available at 1‐833‐932‐3439.

ADDITIONAL LINKS

Debt Relief Announcement https://studentaid.gov/debt‐

relief‐announcement/

Income‐driven Repayment Plans https://studentaid.gov/manage‐

loans/repayment/plans/income‐

driven

Public Service Loan Forgiveness https://studentaid.gov/manage‐

loans/forgiveness‐

cancellation/public‐service

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Who’s My Servicer? https://studentaid.gov/manage‐

loans/repayment/servicers

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Exhibit E 

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Exhibit F 

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