The Biden administration plans to cancel $1.2 billion in student debt for more than 150,000 borrowers

The Biden administration announced on Wednesday its decision to forgive $1.2 billion in student debt for approximately 150,000 borrowers participating in its new repayment program, known as the Saving on a Valuable Education (SAVE) plan.

Under the SAVE plan, relief will be granted to borrowers who have been repaying their loans for ten years or more and initially borrowed $12,000 or less. Typically, borrowers qualify for debt forgiveness under income-driven repayment plans, including SAVE, after making payments for 20 or 25 years. However, the SAVE plan allows borrowers with lower initial loan amounts to have their debt canceled after just a decade.

In January, the Biden administration announced its intention to begin forgiving the debt of these borrowers who had enrolled in the new plan.

U.S. Secretary of Education Miguel Cardona stated, “With today’s announcement, we are once again sending a clear message to borrowers who had low balances: if you’ve been paying for a decade, you’ve done your part, and you deserve relief.” Eligible borrowers will receive emails from President Joe Biden on Wednesday and do not need to take any additional action to receive the relief, according to the U.S. Department of Education.

Since the Supreme Court blocked Biden’s comprehensive student loan forgiveness plan last June, his administration has been utilizing all available authority to reduce the burden of student debt for individuals. To date, it has forgiven debt for nearly 3.9 million borrowers, totaling $138 billion in relief.

Leave comment

Your email address will not be published. Required fields are marked with *.