Biden’s announcement of a one-time student loan forgiveness has made quite the headlines and grabbed everyone’s attention, especially those holding student loans. Now it’s time to figure out if you qualify for forgiveness, and if you happen to qualify for the coveted $20,000 in federal student loan forgiveness mentioned in the announcement. To qualify for $20,000, you need to have been a Federal Pell Grant Recipient. If it has it been a while and you’re not quite sure if you were a Pell Grant Recipient, it’s actually really easy to find out. Read on to learn how to see if you qualify for $20,000 in student loan forgiveness.
What is a Pell Grant?
A federal Pell Grant is a need-based grant offered by the U.S. Department of Education. In order to qualify a student needs to complete the Free Application for Federal Student Aid (FAFSA®) and meet the eligibility requirements. The maximum Pell Grant award varies by year, and the max award for the 2022-2023 award year is $6,895.
If you were a Pell Grant recipient, you would have received your funds for your undergraduate studies (degree or certificate) and/or for an eligible teacher’s certificate program to help pay for school. Pell Grants are limited to students who have yet to earn a bachelor’s degree or its equivalent, with one exception for students attending an eligible postbaccalaureate teacher’s certificate.
Is a Pell Grant a Loan?
I want to be clear about this, a Pell Grant is absolutely not a loan. A Pell Grant is considered “free money” and generally does not need to be repaid. There are very specific circumstances where you may have to return your Pell Grant money and it’s rare when that happens. For example, you withdrew during an academic term and you didn’t earn all your financial aid funds, or it is determined that you committed fraud.
That said, the overwhelming majority of Pell Grant recipients never are required to repay the funds.
Did I Receive a Pell Grant?
If you can’t remember, don’t worry there is a simple way to check. You will need to log into your account at StudentAid.gov. You’ll see the login link on the top right of the homepage. The steps you need to follow are below, but remember, to see your loan and grant breakdown you will need your FSA ID.
1.Click the login at StudentAid.gov
2. Enter your login credentials. Your login credentials will be your FSA ID and password. Don’t worry, if you don’t have an FSA ID, you can get one; and if it’s been a while, you can always reset your password.
3. Once you login, you will see your homepage dashboard. That homepage dashboard will allow you to view your outstanding loans and grants.
4. If you would like, you can “View Details” to view your Pell Grant Breakdown
Why Do You Need a Pell Grant to Qualify for $20,000 Forgiveness?
When it comes down to it, that’s how the forgiveness program was presented. However, there are a few explanations why Pell Grant recipients are being identified for a higher forgiveness amount. For example, according to The White House, Pell Grants typically go to families who earn less than $60,000 a year. Borrowers who received Pell Grants typically experience more challenges when it comes to repaying student loan debt.
In addition, there have been several studies, like the Urban Institute study, that have previously found that black and minority students are more likely to borrow debt and when doing so, borrow larger loan amounts. Black and minority students are also more likely to receive a Pell Grant when compared to their peers. Due to these reasons, the Biden administration has indicated that targeting Pell Grant recipients may help narrow the racial wealth gap.
Still Have Questions?
As of today, Aug. 25, 2022, we know the StudentAid.gov site is receiving a lot of traffic. Please be patient. Remember, the announcement just came out and it didn’t provide dates for when borrowers can expect to see this forgiveness materialize. The details are expected to be coming out in the coming weeks.
Be sure to check out our blog about Biden Student Loan Forgiveness. And don’t forget to follow us on social Facebook, Instagram, Twitter, LinkedIn.