Last week, Congress passed a historic bill that would allow those with Spousal Consolidation Loans to split their loans between the couple. If signed by President Biden, this bill could make hundreds of borrowers eligible for federal student loan forgiveness and solve many of the issues associated with the program. Here’s what you need to know about this week’s student loan trends and how they may affect you.
Prior to 2006, married student loan borrowers could combine their federal student loans into a single Direct Consolidation Loan, often referred to as a Joint Consolidation Loan or Spousal Consolidation Loan. However, since the program closed in 2006, there hasn’t been a way for borrowers to reverse the process. This includes borrowers who have since separated and are in financially harmful situations, like a former spouse refusing to make their share of the monthly payment.
