![]() While the Department does not make the requirement for this “write-off” public, it appears that borrowers must apply while still incarcerated. Contact information for a prison official able to verify the above information, including:.Borrower’s release date or date of eligibility for parole (whichever is sooner).This information should be provided on the prison’s letterhead and be signed by a prison official. Department of Education PO Box 5609 Greenville, TX 75403-5609. The Department may also be reached at (903) 259-3877. Incarcerated borrowers seeking to write-off their federal student loan debt should mail the following list of information to the Department at U.S. Borrowers whose loans are written off using this policy may later restore their eligibility for federal financial aid programs by making repayment arrangements with the Department to have their debt reinstated. Borrowers should note that this write-off will make them ineligible for federal financial aid programs, such as Pell Grants. The Department has said it will “write-off” the federally-held student loans of borrowers whose sentences are 10 years or longer, meaning they would no longer owe the loan. Defaulted Federal Family Education Loan (FFEL) Program loans (both ED-held and commercial-held).Ford Federal Direct Loan (Direct Loan) Program loans After incarcerated students complete or discontinue their PEPs, they must begin repayment on any prior federal student loans to stay out of default.īorrowers with defaulted loans in the following programs are eligible for Fresh Start: Incarcerated borrowers with federal student loans in default who enroll in PEPs qualified to receive Pell Grant funds will have their loans automatically transferred out of default and into in-school deferment status for as long as they are enrolled. These borrowers may apply for financial aid through the Free Application for Federal Student Aid (FAFSA), even before Fresh Start is fully implemented later this year. Qualifying incarcerated borrowers in default who seek to enroll in qualified PEPs will be automatically eligible to apply for federal student aid to help them complete their course of study. These borrowers should enroll in an income-driven repayment plan at, by visiting myeddebt.ed.gov, contacting their loan holder by phone or in writing, or calling the Default Resolution Group at 1-80 as soon as possible. Borrowers with no or very little income may be eligible for an income-driven repayment (IDR) plan, with a payment as low as $0 per month. This “Fresh Start” initiative will make incarcerated borrowers with federal student loans in default eligible for federal student aid, including Pell Grants for prison education programs (PEPs).Īll other borrowers with previously defaulted student loans who do not seek enrollment in a PEP must begin repayment on their loans within one year of the end of the federal student loan payment pause, or risk experiencing the consequences of default once that one year period ends. ![]() Department of Education (ED) announced that it will eliminate the negative effects of default and restore eligibility to receive federal student aid for certain borrowers who are in default on their federal student loans. A “Fresh Start” for Federal Student Loan Borrowers in Default ![]()
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