Biden-Harris Administration approves $7.4 Billion in Student Debt Relief for 277,000 Borrowers

The Biden-Harris Administration unveiled today the green light for an additional $7.4 billion in student loan debt relief, benefiting 277,000 borrowers. These discharges pertain to individuals enrolled in President Biden’s Saving on a Valuable Education (SAVE) Plan, qualifying for its accelerated time-to-forgiveness feature and stemming from corrections made by the Administration to income-driven repayment (IDR) forgiveness. Up to now, the SAVE plan has aided close to 8 million borrowers, encompassing 4.5 million recipients with a $0 monthly payment.

The latest announcement boosts total loan forgiveness approved by the Biden-Harris Administration to $153 billion for almost 4.3 million Americans, equating to one in every 10 Federal student loan borrowers receiving some form of debt relief. This initiative reinforces President Biden’s commitment to expedite debt relief for as many borrowers as possible.

Secretary of Education Miguel Cardona affirmed, “Today’s announcement serves as a testament to the continued dedication of the Biden-Harris Administration in easing the financial strain on hardworking Americans. As long as individuals face overwhelming student loan burdens while balancing basic necessities such as food and healthcare, our resolve to provide relief remains steadfast.”

The $7.4 billion debt relief announced today is allocated as follows:

– “$3.6 billion for around 206,800 borrowers through SAVE”: This relief targets SAVE Plan participants who have smaller postsecondary loans, qualifying for forgiveness after ten years of repayment if their original college borrowing was $12,000 or less. Each additional $1,000 borrowed extends forgiveness by 12 months, culminating in complete forgiveness after 20 or 25 years depending on graduate school loans.
– “$3.5 billion for 65,800 borrowers through administrative adjustments to IDR”: These adjustments bring borrowers closer to forgiveness and address long-standing issues concerning forbearance misuse by loan servicers.
– “$300 million for 4,600 borrowers through PSLF fixes”: Following recent PSLF enhancements, the Administration has greenlit $62.8 billion in forgiveness for nearly 876,000 borrowers via PSLF.

Under Secretary of Education James Kvaal highlighted, “Today, 277,000 borrowers who have diligently repaid their student loans for over a decade are set to receive relief. They have fulfilled their payment obligations and deserve loan forgiveness for the remaining balance.”

The Biden-Harris Administration has introduced a new set of plans to provide student debt relief to over 30 million borrowers, alongside the 4 million who have already been approved for debt cancellation. These plans aim to waive interest for millions, automatically discharge debt for eligible borrowers not enrolled in existing forgiveness programs, eliminate debt for long-term repayment cases, support individuals in low-value programs or institutions, and aid those facing repayment hardships.