These Borrowers Will Soon Qualify for Automatic Student Loan Forgiveness—Are You Eligible?

Core Insights - Approximately 160,000 borrowers are set to qualify for automatic student loan forgiveness due to attending schools involved in misconduct, with notifications expected by March 29, 2026 [1] - The Department of Education is expediting the processing of borrower defense applications following a settlement from the Sweet v. McMahon lawsuit, which alleged delays in processing [1] - The automatic forgiveness will significantly improve the financial situation of affected households, potentially increasing consumer spending [1] Eligibility for Automatic Forgiveness - Borrowers eligible for automatic forgiveness must have applied for loan discharge between June 23, 2022, and November 16, 2022, and attended one of over 150 identified schools [1] - About 80% of the total 200,000 applicants fall into this category and are entitled to "full settlement relief" [1] - Notifications regarding forgiveness will be sent via email, and any requests for payment related to the borrower defense claim should be considered scams [1] Impact of the Sweet v. McMahon Settlement - The settlement requires the Department of Education to make decisions on all borrower defense applications submitted before November 16, 2022, by January 28, 2026 [1] - Approximately 200,000 borrowers who applied during the specified period are awaiting decisions, with most expected to receive notifications soon [1] - The Department of Education's appeal for an extension to respond to these applicants was rejected, indicating a commitment to expedite the process [1] Additional Borrower Defense Options - Borrowers who applied for defense forgiveness outside the specified dates may still be eligible but will not receive automatic forgiveness [1] - About 20% of the 200,000 applicants did not attend the identified schools and are owed a decision by April 15, 2026 [1] - Those who applied before June 23, 2022, should have already received their forgiveness, and can contact the Department of Education if they have not [1]