U.S. President Joe Biden speaks at the Abbotts Creek Community Center during an event promoting his economic policies on January 18, 2024 in Raleigh, North Carolina.
Saul Loeb | AFP | Getty Images
The Biden administration announced Friday that it would forgive $4.9 billion in student loans for 73,600 borrowers.
This relief is the result of the U.S. Department of Education’s amendments to income-based repayment plans and public service loan forgiveness programs.
“The Biden-Harris Administration will fix our nation’s broken student loan system and eliminate the unnecessary hurdles and administrative hurdles that have prevented borrowers from receiving the student loan forgiveness they deserve in the past,” said Miguel Cardona, U.S. Secretary of Education. “We have worked relentlessly to address the inaccuracies.” In a statement.
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About $1.7 billion in aid will go to 29,700 borrowers enrolled in income-based repayment plans. These plans are supposed to lead to debt forgiveness after a certain period of time, but experts say that hasn’t always happened historically because debt collection companies have been unable to track borrowers’ payments.
Additionally, 43,900 borrowers who worked in the public sector for more than 10 years will receive $3.2 billion in loan cancellations, the U.S. Department of Education announced. Borrowers in the Public Service Loan Forgiveness Program are also having trouble getting promised debt forgiveness due to incorrect payment numbers and other problems.
The announcement did not say when eligible borrowers could expect that relief.
The Biden administration has now canceled more than $136 billion in student loans for more than 3.7 million Americans.
Consumer advocacy groups have praised President Joe Biden’s recent actions but are pressuring him to do more.
Mr. Biden campaigning for the 2020 presidential election Pledged to cancel at least $10,000 in student debt for each person.
Astra Taylor, co-founder of the Debt Collective, said in an interview with CNBC last fall that “student loan cancellation tilted things in favor of Democrats in the midterm elections.” “Failure to implement policies will demoralize and demobilize young people who cannot afford to lose their votes.”
Biden’s plan to cancel up to $400 billion in student loans for tens of millions of Americans was blocked by the Supreme Court last June. The high court said the president did not have the authority to direct the secretary of education to cancel so many consumer debts without prior approval from Congress.