In a significant move, the Biden Administration has announced additional student loan debt relief, benefiting thousands of borrowers. As the student loan landscape evolves, here’s what you need to know about the latest developments.
$7.7 Billion in Approved Debt Relief
The Biden-Harris Administration has approved an impressive $7.7 billion in student loan debt relief for 160,500 borrowers. Let’s break down who stands to benefit:
Public Service Loan Forgiveness (PSLF) Recipients:
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- A total of $5.2 billion will be forgiven for 66,900 borrowers through fixes to the PSLF program.
- This brings the overall PSLF forgiveness to $68 billion for over 942,000 borrowers.Saving on a Valuable Education (SAVE) Plan Participants:
- The SAVE Plan targets borrowers with smaller loans for postsecondary studies.
- Borrowers who originally borrowed $12,000 or less will receive relief after at least 10 years of payments.
- For each additional $1,000 borrowed, an extra 12 months until forgiveness applies.
- All SAVE Plan participants receive forgiveness after 20 or 25 years, depending on graduate school loans.
- Income-Driven Repayment (IDR) Fixes:
- An additional $613 million will be erased from the accounts of 54,300 borrowers.
- The IDR plan allows debt forgiveness after 20 or 25 years of payments, depending on the loan type.
- The recent adjustments review borrowers’ accounts, crediting them for partial and late payments.
Impact and Relief
This action builds on President Biden’s commitment to provide debt relief swiftly. With more than 8 million borrowers benefiting from the SAVE Plan, financial breathing room is becoming a reality. One out of every 10 federal student loan borrowers now has a burden lifted.
