Biden Administration to Cancel Over $6 Billion in Federal Student Loan Debt
Written by SOURCE on March 10, 2022
Thousands of people will soon be free of student loan debt.
On Wednesday, the U.S. Education Department announced it had identified an additional 30,000 borrowers who are now eligible for Public Service Loan Forgiveness—a program that forgives student debt for various public servants who make 10 years of monthly payments. PSLF was created about 15 years ago with the intention of helping borrowers who worked in education, health care, emergency services, and more. However, the Biden administration expanded the program back in October, after it was criticized over its strict and confusing requirements that resulted in a 98 percent denial rate for applicants.
The temporary changes allowed borrowers to receive credit for loan repayments that originally didn’t qualify. According to CNN, there are now roughly 100,000 people who eligible for PSLF; those cancelations will total approximately $6.2 billion in student debt relief. When announcing the changes last fall, the Biden administration estimated about 550,000 borrowers would benefit from the updated program.
“Our nation’s public service workers must be able to rely on the promise of Public Service Loan Forgiveness. The Biden-Harris administration is delivering on that promise by helping more and more eligible borrowers get their loan balances forgiven,” Education Secretary Miguel Cardona said in a statement. “The PSLF announcement made today means more of our dedicated teachers, nurses, first responders, service members, and many other public service workers will get meaningful relief.”
Officials told CNN not all eligible borrowers have been notified of their debt relief, and it’s unclear when they will be contacted. Borrowers have not been required to pay their federal student loans since March 2020, when former president Donald Trump signed the CARES Act into law. The current administration is expected to lift that pause on May 1.
Biden has yet to fulfill his campaign promise to cancel at least $10,000 of student debt per borrower. There are reportedly 43 million people who have federal student loan debt, which amounts to more than $1.7 trillion.
