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Student Loans: How Much Do I Owe?

How Much Do I Owe in Student Loans?
Sulaiman Abdur-Rahman
Sulaiman Abdur-RahmanUpdated September 13, 2022
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Editor’s note: Lantern by SoFi seeks to provide content that is objective, independent and accurate. Writers are separate from our business operation and do not receive direct compensation from advertisers or partners. Read more about our Editorial Guidelines and How We Make Money.
Most federal student loan borrowers would owe $10K or $20K less in federal repayment obligations under President Joe Biden’s debt relief plan. Biden’s debt forgiveness plan may cancel the full remaining balance for roughly 20 million borrowers, but millions more would still carry an outstanding loan balance when all is said and done.Federal student loan borrowers may access their Federal Student Aid online dashboard to check how much they owe in outstanding federal student loans.Private student loan borrowers may contact their individual loan servicers to check the balance of their private student loans. Your credit report may also contain information regarding the balance of any active student loans you took out.

How Much Do You Owe After Biden’s Forgiveness Plan

About 20 million federal student loan borrowers would owe nothing after receiving $10K or $20K in debt relief from President Biden’s loan forgiveness plan. Several plaintiffs have filed civil-action complaints challenging the legality of Biden’s debt relief program, so it’s unclear whether broad student loan forgiveness will happen. The forgiveness program announced by President Biden would provide up to $10K in debt relief to federal student loan borrowers with annual incomes below $125,000 ($250,000 for married couples). Some borrowers may qualify for $20K in debt forgiveness under Biden’s plan if they’re Pell Grant recipients who meet the income threshold. Millions of borrowers who may benefit from the Biden administration debt forgiveness plan would still owe some amount of money. Student loan borrowers are generally expected to repay their education loan debts over time. The amount you owe in student loans may include principal and interest charges. Your interest rate can impact how much you owe.The Biden administration’s debt relief plan may reduce the average student loan debt across the United States. Average federal student loan debt in 2021 stood at $36,510 per borrower, while private student loan debt averaged $54,921 per borrower, according to Education Data Initiative research.

How Do I Find Out How Much I Owe on Student Loans?

Details remain forthcoming, but most federal student loan borrowers may have to take certain steps to receive the $10K or $20K of debt relief. Most eligible borrowers may have to provide the U.S. Department of Education with income information to claim the relief. The department said it has income data on nearly 8 million borrowers who may automatically receive the forgiveness without lifting a finger. The plan is targeted to provide relief for 43 million borrowers, including 20 million who would no longer owe federal student loan payments after receiving the forgiveness. The Biden administration’s debt relief plan faces legal challenges in the federal courts that could block it from happening. If the program moves forward as planned, borrowers may receive up to $10K or $20K in federal student loan forgiveness before the repayment pause ends in mid-2023. Highlighted below are some ways you can find out how much you owe on student loans:

Calculating How Much You Owe in Private Student Loans

You may contact your private student loan servicers to check the balance of your private student loans. Private lenders may be available to answer your questions via email, telephone, fax, or postal mail. Borrowers with more than one private lender may have to contact each private lender individually to check the loan balance for each account. Every private lender is different, and your private lender may allow you to check your account balance online. You may check the balance for each of your private student loans to calculate how much you owe in total. Your credit report may also contain information regarding the balance of any active student loans you took out. The Fair Credit Reporting Act gives borrowers the right to obtain their free credit report every 12 months upon request.

Finding How Much You Owe in Federal Student Loans

Finding out how much you owe in federal student loans can be done in one of the following ways:
  • Contacting your federal loan servicer and asking how much you owe
  • Contacting your school’s financial aid office and asking whether the school has loan balance information on what you owe
The difference between federal student loan debt and private student loan debt is that federal student loans are provided exclusively by the U.S. Department of Education. Banks, credit unions, online lenders, and select state-based or state-affiliated organizations may offer private student loans.

Paying Off Student Debt

Borrowers can make extra payments to minimize interest charges and pay off student loans early. Some borrowers, however, may never finish repaying a student loan during their lifetime. You may ask, how long does it take to pay off student loans? It can take borrowers between 10 to 30 years to pay off federal student loans and five to 25 years to pay off private student loans. What happens to student loans when you die is the debt might be discharged, although some private lenders may demand repayment from your estate. The federal government in March 2020 suspended student loan payments in response to the COVID-19 pandemic. After a number of extensions, the moratorium on student loan payments is scheduled to be lifted on Dec. 31, 2022.

Loan Consolidation

Borrowers may consolidate their federal student loans into a Direct Consolidation Loan. Consolidation can merge all of your federal student loan liabilities into a single federal loan. It can also give you up to 30 years to repay your loans in certain cases. You may lower your monthly payment by consolidating into a longer repayment period. Consolidation can also simplify your federal student loan repayment obligations if you merge all of your federal loans into a single loan product.

Loan Forgiveness

In addition to President Biden’s broad student loan forgiveness plan, the federal government offers income-driven repayment plans that may lead to loan forgiveness after 20 or 25 years. Public employees with federal student loan obligations may have access to the Public Service Loan Forgiveness program. Educators with federal student loans in some cases may be eligible for up to $17,500 in federal student loan forgiveness under the Teacher Loan Forgiveness program. Unlike the federal government, a private lender may be reluctant or unwilling to forgive a borrower’s private student loan debt. Private lenders in some cases may reach a debt settlement agreement with delinquent borrowers. Debt settlement agreements may include debt forgiveness provisions, which may qualify as taxable income in some cases. This means forgiven student loans may carry income tax liabilities at the state or federal levels, but the Biden administration’s broad loan forgiveness plan would not be treated as taxable income for federal income tax purposes.

Defaulting on Student Loans

Defaulting on student loans can have a severe impact on your credit scores, and your wages may also be garnished. Private lenders may find you in default of your private student loans if you fail to make a monthly payment when due. Borrowers of federal student loans may default on their obligations if they have not made a payment in more than 270 days. Student loan borrowers may have opportunities to cure their defaults by contacting their loan servicers and making immediate repayments.

Refinancing Your Student Loans

Refinancing federal student loans can allow borrowers to replace their existing federal loans with the terms and conditions of a private loan agreement. Private lenders can set their own underwriting standards for refinancing, but some may require applicants to have steady income and good credit. For subprime borrowers, it might be difficult to refinance student loans with bad credit. How student loan refinancing works is that borrowers submit an application with a private lender requesting a new loan agreement for refinancing student loan debt. Reviewing the pros and cons of refinancing student loans can help you decide whether refinancing is right for you. One of the advantages of refinancing student loans is it may provide you with a lower interest rate. One of the big disadvantages of refinancing student loans with a private lender, however, is you’ll be forfeiting federal benefits. The portion of a federal student loan that you refinance would no longer be eligible for federal income-driven repayment plans and certain loan forgiveness programs, such as military student loan forgiveness and Biden’s loan forgiveness program. Some borrowers may find it worthwhile to refinance their remaining federal student loan balance only if they receive up to $20K in debt relief from President Biden’s loan forgiveness plan. Borrowers may refinance federal student loans at any time, and borrowers may also refinance their private student loans. This means federal student loan borrowers may switch from a federal repayment plan to a private student loan refinancing payment plan. Student loan refinancing might be right for you if you can lock in a lower interest rate. The average interest rate on student loans among all existing borrowers as of April 2022 stood at 5.8%, according to the Education Data Initiative.

Refinance Your Student Loans With Lantern

The Biden administration’s debt relief plan is not a game changer for all borrowers. If you remain burdened with education loan debt and would like to refinance student loans, Lantern by SoFi can help. Refinancing might be right for you if you can lock in a lower interest rate.Explore your student loan refinancing options with Lantern.

Frequently Asked Questions

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Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.
Photo credit: iStock/miniseries

About the Author

Sulaiman Abdur-Rahman

Sulaiman Abdur-Rahman

Sulaiman Abdur-Rahman writes about personal loans, auto loans, student loans, and other personal finance topics for Lantern. He’s the recipient of more than 10 journalism awards and currently serves as a New Jersey Society of Professional Journalists board member. An alumnus of the Philadelphia-based Temple University, Abdur-Rahman is a strong advocate of the First Amendment and freedom of speech.
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