Biden-Harris Administration Has Now Approved $153 Billion in Relief for Nearly 4.3 Million Borrowers Across the Country

Source: U.S. Department of Education

The Biden-Harris Administration announced on Monday the approval of $7.4 billion in additional student loan debt relief for 277,000 borrowers. These discharges are for borrowers who signed up for President Biden’s Saving on a Valuable Education (SAVE) Plan and are eligible for its shortened time-to-forgiveness benefit and as a result of fixes made by the Administration to income-driven repayment (IDR) forgiveness. This action comes as nearly 8 million borrowers have been helped by the SAVE plan. That includes 4.5 million with a $0 monthly payment.

Today’s announcement brings the total loan forgiveness approved by the Biden-Harris Administration to $153 billion for nearly 4.3 million Americans. Thanks to this Administration’s efforts one out of every 10 Federal student loan borrowers has now been approved for some debt relief. This action builds on President Biden and his Administration’s efforts to provide debt relief to as many borrowers as possible as quickly as possible.

The debt relief announced today is broken down into the following categories:

• $3.6 billion for nearly 206,800 borrowers through SAVE. This relief will go to borrowers who are 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 for college. Each additional $1,000 in borrowing adds 12 more months until forgiveness. All borrowers on SAVE 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 SAVE to $4.8 billion for almost 360,000 borrowers.
• $3.5 billion for 65,800 borrowers through administrative adjustments to IDR payment counts that 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 $49.2 billion in IDR relief for more than 996,000 borrowers.
• $300 million for 4,600 borrowers through fixes to Public Service Loan Forgiveness (PSLF). This update comes shortly after the Department announced new PSLF discharges a few weeks ago. The Administration has now approved $62.8 billion in forgiveness for almost 876,000 borrowers through PSLF.

“Today we are helping 277,000 borrowers who have been making payments on their student loans for at least a decade,” said U.S. Under Secretary of Education James Kvaal. “They have paid what they can afford, and they have earned loan forgiveness for the balance of their loan.”

As discussed in IOScholarships interview with Univision, the relief provided by these discharges could have positive effects on borrower financial security, and outcomes such as buying food in the supermarket health services, and achieving their financial goals.

Borrowers will begin receiving emails informing them of their approvals. Their relief will be processed in the weeks following.

New Plans to Deliver Debt Relief to Tens of Millions of Americans

Earlier this week, the Biden-Harris Administration released initial details of a new set of plans that would provide student debt relief for tens of millions of borrowers across the country. The plans would bring the total number of borrowers eligible for student debt relief to over 30 million, including the 4 million borrowers who have already been approved for debt cancellation by the Biden-Harris Administration over the past three years. The plans announced by President Biden are the next step in a regulatory process that began last summer to provide debt relief to as many borrowers as possible as quickly as possible under the Higher Education Act. The proposals would permit the following types of waivers:

• Waiving accrued and capitalized interest for millions of borrowers;
• Automatically discharging debt for borrowers otherwise eligible for loan forgiveness under SAVE, closed school discharge, or other forgiveness programs, but not enrolled;
• Eliminating student debt for borrowers who entered repayment 20 or more years ago;
• Helping borrowers who enrolled in low-financial-value programs or institutions; and
• Assisting borrowers who experience hardship in paying back their loans.

An Unparalleled Track Record of Borrower Assistance

Beyond the relief under IDR, SAVE, and PSLF, the Biden-Harris Administration has also approved:

• $22.5 billion for more than 1.3 million borrowers who were cheated by their schools, saw their institutions precipitously close, or are covered by related court settlements.
• $14.1 billion for more 548,000 borrowers with a total and permanent disability.