Biden-Harris Administration Announces Additional $7.7 Billion in Approved Student Debt Relief for 160,000 Borrowers
The Biden-Harris Administration announced the approval of $7.7 billion in additional student loan debt relief for 160,500 borrowers. These discharges are for three categories of borrowers:
- those receiving Public Service Loan Forgiveness (PSLF);
- those who signed up for President Biden’s Saving on a Valuable Education (SAVE) Plan and who are eligible for its shortened time-to-forgiveness benefit; and
- those receiving forgiveness on income-driven repayment (IDR) as a result of fixes made by the Administration. This action comes as more than 8 million borrowers have been helped by the SAVE Plan. That includes 4.6 million with a $0 monthly payment.
Recently, the U.S. Department of Education (Department) also announced an update on the timing of the payment count adjustment. This administrative fix ensures borrowers get credit for progress borrowers made toward IDR forgiveness and PSLF. Borrowers who would benefit from consolidating now have until June 30, 2024, to apply to consolidate. Learn more about the payment count adjustment.
The debt relief announced is broken down into the following categories:
- $5.2 billion for 66,900 borrowers through fixes to PSLF: The Administration has now approved $68 billion in forgiveness for more than 942,000 borrowers through PSLF.
- $613 million for 54,300 borrowers through the SAVE Plan: This relief will go to borrowers enrolled in the SAVE Plan who had smaller loans for their postsecondary studies. Borrowers can receive relief after at least 10 years of payments if they originally borrowed $12,000 or less. Each additional $1,000 in borrowing adds 12 more months until forgiveness. All borrowers on the SAVE Plan receive forgiveness after 20 or 25 years, depending on whether they have loans for graduate school. The benefit is based upon the original principal balance of all Federal loans borrowed to attend school, not what a borrower currently owes or the amount of an individual loan. Today’s announcement brings total relief approved under the SAVE Plan to $5.5 billion for 414,000 borrowers.
- $1.9 billion for 39,200 borrowers through administrative adjustments to IDR payment counts. These adjustments have brought borrowers closer to forgiveness and address longstanding concerns with the misuse of forbearance by loan servicers. Including today’s announcement, the Biden-Harris Administration has now approved $51.0 billion in IDR relief for more than 1 million borrowers.
“Another 160,000 borrowers and their families will get some much-needed relief thanks to the continued efforts the Biden-Harris Administration to fix the broken student loan system,” said U.S. Under Secretary of Education James Kvaal. “We congratulate those borrowers on their due forgiveness and we will continue to work to deliver relief to others.”
Read the full release on the Department’s website.
Tags: federal issues
