These are the 3 factors that take priority when it comes to student loan forgiveness.
Private student loans aren't eligible for cancellation.Considering that the average student loan balance is over $30,000, many people will, may be lower. That's because the Education Department plans to"reamortize" borrowers' new balances. That's a wonky term that means it will recalculate your monthly payment based on your new balance and the number of months you have left on your repayment timeline.
Kantrowitz provided an example: Let's say you currently owe $30,000 in student loans with a 5% interest rate. Before the pandemic, you paid around $320 a month on a 10-year repayment term. If you get $10,000 in student loan forgiveness, your total balance would be reduced by a third, and your monthly payment will also drop by a third, to roughly $210 a month. Your repayment timeline remains the same as before.
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