What is the IDR Account Adjustment?
A Multi-Step Approach to Fix Student Loan Repayment Tracking
IDR Account Adjustment: On July 14th, 2023, the U.S. Department of Education announced the latest implementation of theĀ multi-step approachto address longstanding failures associated withĀ student loan payment count tracking,Ā income-driven repayment (IDR) forgiveness, andĀ Public Service Loan Forgiveness (PSLF)Ā for borrowers.
How the IDR Waiver Provides Loan Forgiveness
Formerly announced as the IDR Account Adjustment or IDR Waiver in April 2022, this collection of fixes is designed to give borrowers an easier path to repayment by changing key aspects of the student loan servicer collection procedures and crediting borrowers months and years toward forgiveness that were previously undercounted under income-based repayment (IBR) plans.
Who Qualifies for Student Loan Forgiveness Under This Adjustment?
Loan Forbearance and Deferment That Now Counts Toward Forgiveness
One of the key fixes included is a one-time account adjustment, which counts certain long-term forbearances toward IDR and PSLF forgiveness.
- Forbearance Periods Over 12 Months: Borrowers who experienced more than 12 consecutive months or 36 months total of forbearance will have those months counted toward repayment.
- Deferments Prior to 2013: Time spent in deferment before 2013 (excluding in-school deferments) will count as repayment.
- Economic Hardship and Military Deferment After 2013: Time spent in these deferments after 1/1/2013 will be credited toward repayment.
- Covid-19 Forbearance (March 2020 – Present): Automatically counts toward repayment.
- All IDR Months: Automatically count toward repayment.
What This Means for Hope Credit Borrowers
How to Check If You Qualify for Loan Forgiveness
The U.S. Department of Education has committed to beginning the process of loan forgiveness for borrowers who:
- Have been in repayment for 20+ years (Undergraduate loans)
- Have been in repayment for 25+ years (Graduate loans)
If you are a Hope Credit client, your student loan forgiveness process should begin within 30 days of July 14, 2023.
Loan Servicer Notifications and Processing Timeline
Hope Credit clients have reported receiving notifications from the U.S. Department of Education, stating:
“The Department of Education will work with your servicer to process your forgiveness.”
Hope Credit will update clients on expected processing times as more clients receive notifications.
How Much Student Loan Forgiveness Has Been Approved So Far?
$100 Billion in Total Student Loan Forgiveness
According to the U.S. Department of Education, a total of $100 billion in student loan forgiveness has been approved:
- $42 Billion: Under the Public Service Loan Forgiveness (PSLF) Waiver
- $19 Billion: From Borrower Defense to Repayment, Closed School Discharge, and Total and Permanent Disability (TPD) Discharge
- $39 Billion: Through the IDR Adjustment
Next Steps ā How to Take Advantage of the IDR Adjustment
What to Do If You Havenāt Been Notified Yet
If you believe you qualify for student loan forgiveness but have not received a notification:
- ā Log into StudentAid.gov and check your loan servicerās status updates.
- š§ Check your email or mail for updates from the U.S. Department of Education.
- š Contact your loan servicer for status on your IDR forgiveness application.
How Hope Credit Can Assist You with the Process
- ā A Hope Credit caseworker can verify your eligibility.
- šļø We help you understand your loan servicer notifications.
- š We provideĀ updatesĀ based on feedback from other Hope Credit clients.
Conclusion
The IDR Adjustment is a crucial step toward student loan forgiveness for hundreds of thousands of borrowers. If you are a Hope Credit client, ensure you review your eligibility and stay updated with your loan servicerās notifications.