President Joe Biden has once again made strides in alleviating the burden of student loan debt, announcing the forgiveness of an additional $7.4 billion in loans for approximately 277,000 borrowers.
This latest initiative brings the total amount of student loans forgiven by the Biden-Harris Administration to a staggering $153 billion, benefiting almost 4.3 million Americans.
Originally, in 2022, the administration proposed a comprehensive student loan forgiveness plan aiming to relieve up to $20,000 in loans for all borrowers, with an estimated cost of $400 billion.
However, this proposal faced challenges and did not pass the Supreme Court. Undeterred, the Administration has pursued alternative avenues to reduce student loan balances for a broader spectrum of Americans.
Relief Efforts Continue as Over 277,000 Borrowers Benefit from Latest Round of Debt Cancellations
In February 2024, during a visit to Culver City, President Biden announced the cancellation of an additional $1.2 billion in student loan debt for approximately 153,000 borrowers.
This move underscores the administration’s ongoing commitment to providing relief, particularly after the Supreme Court blocked a more expansive plan the previous year.
The latest round of forgiveness targets different groups of borrowers. Approximately 206,800 borrowers enrolled in Biden’s Saving on a Valuable Education (SAVE) plan will benefit, alongside another 65,800 borrowers on the administration’s income-driven repayment plan (IDR), and nearly 5,000 borrowers participating in the Public Service Loan Forgiveness (PSLF) plan.
Under the SAVE plan, borrowers with smaller loans for their postsecondary education, specifically those amounting to $12,000 or less, who have made payments for nearly a decade, will receive relief.
Each additional $1,000 borrowed will require an additional 12 months of payments, with forgiveness granted after 20 or 25 years, depending on whether the loans were for graduate studies.
For borrowers under IDR facing forbearance issues with their loan servicers, approximately $3.5 billion will be forgiven. Notifications will be sent to those who qualify.
Additionally, an allocation of $300 million will be directed towards further adjustments for borrowers under the PSLF plan, which aims to provide relief for individuals in public service roles such as teachers and nurses.
This ongoing effort reflects the Biden-Harris Administration’s commitment to addressing the student loan crisis and easing the financial burden on millions of Americans pursuing higher education and public service careers.
