On Wednesday (December 6), the Biden administration announced that it plans to cancel $5 billion more in student loan debt, helping out over 80,300 borrowers. The new round of student loan relief will affect those under the income-driven repayment forgiveness and Public Service Loan Forgiveness programs.
This new announcement follows the Supreme Court striking down President Joe Biden‘s initial student loan forgiveness program, which promised up to $20,000 in debt relief for low- and middle-income borrowers. Since the rejection of Biden’s initial plan, the Biden-Harris administration has found another way to provide debt relief to thousands upon thousands of borrowers.
The U.S. Education Department’s new cancelations are expected to bring the total amount of student debt relief to $132 billion for more than 3.6 million borrowers. However, it is noted that the new cancelations are still only limited to specific categories of borrowers: public-sector workers, people defrauded by for-profit colleges, and borrowers who have been paying off their loans for at least 20 years.
Again, these borrowers fall under the Public Service Loan Forgiveness program (which eliminates remaining student loan debt after qualifying public-sector workers make 10 years’ worth of monthly payments) or income-driven repayment forgiveness program (which means they’ve been making at least 20 years’ worth of qualifying payments with an IDR plan but didn’t previously receive credit for all of their student loan payments).
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It is reported that most of the borrowers affected were already notified in November that their outstanding federal student loan debt would be canceled and that they can expect to see changes made to their accounts in the next few weeks.
In an additional statement released on Wednesday, Biden said, “We are continuing to pursue an alternative path to deliver student debt relief to as many borrowers as possible as quickly as possible.”
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Also speaking on the new cancelations is Education Secretary Miguel Cardona, who stated, “Before President Biden took office, it was virtually impossible for eligible borrowers to access the student debt relief they rightfully earned.”
Cardona continued, “The data released today once again make clear that the Biden-Harris Administration’s relentless efforts to fix the broken student loan system are paying off in a big way, with more than 3.6 million borrowers now approved for nearly $132 billion in loan forgiveness. This level of debt relief is unparalleled and we have no intention of slowing down.”
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