If you weren’t able to take advantage of the Income-Driven Repayment (IDR) Account Adjustment deadline by April 30th, then we have good news! The Department of Education (ED) has extended the deadline a second time from April 30, 2024 to June 30, 2024. This means that borrowers now have until the end of this month to qualify for the one-time payment count adjustment.

What is the IDR Account Adjustment?

The IDR Account Adjustment offers payment credit toward IDR forgiveness and Public Service Loan Forgiveness (PSLF) for previously ineligible payments, certain periods of deferment or forbearance, and more. Credit will be awarded even if borrowers were not making payments or enrolled in an IDR plan. Parent PLUS borrowers, too, who are normally left out of these types of initiatives, may benefit, but they may need to act first.

What will receive payment credit?

  • Any months in a repayment status, regardless of the payments made, loan type, or repayment plan;
  • Twelve or more months of consecutive forbearance or 36 or more months of cumulative forbearance;
  • Any months spent in economic hardship or military deferments in 2013 or later;
  • Any months spent in any deferment (with the exception of in-school deferment) prior to 2013; and
  • Any time in repayment (or deferment or forbearance, if applicable) on earlier loans before consolidation of those loans into a consolidation loan.

In addition, months described above that occurred prior to a loan consolidation will also be counted toward forgiveness.

This affects borrowers who are:

  • on an IDR plan or were previously on one; or
    enrolled in the PSLF program; or
  • not on an IDR plan but have Direct or Federal Family Education Loan (FFEL) program loans held by ED; or
  • not on an IDR plan and have non-Direct federal loans, such as commercially-held FFEL, Perkins, or HEAL loans, if they take required steps to qualify

Borrowers with FFEL Program loans held by ED who want to count any prior time in repayment toward PSLF must apply to consolidate into the Direct Loan Program by June 30.

Is there anything else to know?

Previously, ED stated the adjustment to payment counts would be complete by July 2024, but this timeline has also been pushed back. The ED now expects the adjustment to be “fully implemented” in September 2024.

Source: Biden-Harris Administration Allows Borrowers More Time to Consolidate Loans to Get Credit for Progress Toward Loan Forgiveness Programs, U.S. Department of Education (ED)

Have questions regarding your federal student loans?

Contact us today for more information and to learn more.

Click Here for More Info