Biden-Harris Administration Approves $1.2 Billion Loan Forgiveness for More Than 150,000 SAVE Plan Borrowers

The Biden-Harris Administration today announced it will discharge $1.2 billion in loans for nearly 153,000 borrowers eligible for the shortened time to forgiveness benefit under President Biden’s SAVE Plan. This comes as 7.5 million borrowers are enrolled in SAVE, with 4.3 million having a $0 monthly payment.

“Today’s announcement reaffirms our commitment to borrowers with low balances: after a decade of payments, you deserve relief,” stated U.S. Secretary of Education Miguel Cardona. The Administration has approved loan forgiveness for nearly 3.9 million borrowers under President Biden’s leadership, with efforts to cancel student debt ongoing.

In January, President Biden accelerated the shortened time to forgiveness component of the SAVE Plan, granting relief to borrowers sooner than expected. Eligible borrowers must be part of the SAVE Plan, have made at least 10 years of payments, and initially borrowed $12,000 or less for college. Additional forgiveness is provided for each $1,000 borrowed above $12,000, with all SAVE participants receiving forgiveness after 20 or 25 years. Forgiveness is based on the original principal balance of Federal loans borrowed for schooling.

“We have now approved loan relief for nearly 3.9 million borrowers, fulfilling our promise to reform the student loan system,” said U.S. Under Secretary of Education James Kvaal. President Biden’s dedication to student debt cancellation remains steadfast.

Borrowers will receive emails from President Biden informing them of forgiveness approval. Servicers will process forgiveness, clearing loans from borrowers’ accounts automatically. Those eligible for forgiveness under the SAVE Plan will have their loans discharged without any action required on their end.

Borrowers who meet the criteria are urged to promptly enroll in SAVE at StudentAid.gov/save.

An Unprecedented Record of Student Debt Relief

The Biden-Harris Administration has authorized the cancellation of debt for nearly 3.9 million Americans, providing relief amounting to almost $138 billion. The Administration has enhanced Federal Pell Grants significantly and established rules safeguarding borrowers from burdensome debts.

The Administration has approved:

• $56.7 billion for over 793,000 borrowers through PSLF fixes.
• $45.6 billion for 930,500 borrowers via income-driven repayment improvements.
• $11.7 billion for 513,000 permanently disabled borrowers, including automatic discharges based on SSA data.
• $22.5 billion for 1.3 million borrowers through various discharges and settlements.

The Administration is formulating regulations to increase borrower eligibility for loan forgiveness and discussing proposals for hardship forgiveness. These actions align with President Biden’s commitment to finding alternative pathways for student debt relief.

Increased Enrollment in SAVE

7.5 million borrowers are now part of the SAVE Plan, with 4.3 million having $0 payments. The SAVE Plan offers affordable repayment options for low- and middle-income borrowers, paving the way for earlier forgiveness.

The SAVE Plan shields borrowers from escalating interest rates and balances exceeding their original loan amounts. The upgraded application involves sharing income data with the IRS, eliminating the need for annual recertification.

Starting July 2024, the Department will implement further SAVE Plan benefits, reducing monthly payments from 10 percent to 5 percent of a borrower’s discretionary income.

For more information on forgiveness programs visit StudentAid.gov/forgiveness. To explore the right repayment plan, visit StudentAid.gov/restart. Learn about the SAVE Plan at StudentAid.gov/save.