Around 804,000 borrowers, with $39 billion in federal student loans, will be automatically discharged in the coming weeks, the U.S. government said.
Around 804,000 borrowers, with $39 billion in federal student loans, will be automatically discharged in the coming weeks, the U.S. government said.
The United States’ Department of Education has unveiled state-by-state data detailing the number of borrowers eligible for automatic loan relief through Income-Driven Repayment plan fixes introduced by the Biden-Harris Administration.
Around 804,000 borrowers, with $39 billion in federal student loans, will be automatically discharged in the coming weeks, the government said in a press release. This brings the total student loan forgiveness approved under the current administration to over $116 billion for 3.4 million borrowers.
The loan discharges address past failures in the administration of federal student loans, ensuring accurate counting of qualifying monthly payments towards forgiveness.
To be eligible, borrowers need to have gathered the corresponding amount of qualifying months, which could be either 20 or 25 years, depending on their loan type and IDR plan. This measure is a direct result of the payment count adjustment introduced by the Biden-Harris Administration in April 2022.
“I have long said that college should be a ticket to the middle class — not a burden that weighs down on families for decades,” said President Joe Biden.
He also celebrated the relief provided to over 800,000 borrowers who have been repaying their loans for two decades or more, emphasizing that this action corrects past failures and brings the total loan relief under his Administration to over $116 billion for more than three million borrowers.
“As long as I’m in office, I will continue to work to bring the promise of college to every American,” Biden said.
The Department of Education notified eligible borrowers who qualify for forgiveness without further action. The commencement of discharges will take place 30 days after the notifications have been dispatched. Borrowers can opt out if they wish, and repayment will pause during the discharge process.
Meanwhile, US Secretary of Education Miguel Cardona emphasized the significance of this historic step to rectify past administrative failures and ensure borrowers receive the forgiveness they deserve. He also underlined the Administration’s determination to level the playing field in higher education by addressing past injustices and providing relief to public servants, students deceived by their colleges, and borrowers with permanent disabilities, including veterans.
The Department also assured it will continue identifying and notifying eligible borrowers every two months until next year, based on applicable forgiveness thresholds. Any month counted for forgiveness can also be counted toward Public Service Loan Forgiveness if qualifying employment is documented.
This latest data release builds on the Biden-Harris Administration’s remarkable track record of student debt relief, including $45 billion for 653,800 public servants through improvements to PSLF, $10.5 billion for 491,000 borrowers with total and permanent disability, and $22 billion for nearly 1.3 million borrowers who were victimized by fraudulent schools, faced sudden school closures or are covered by related court settlements.
The Biden-Harris Administration also introduced the Saving on a Valuable Education (SAVE) plan, the most affordable payment plan ever, reducing undergraduate loan payments and protecting borrowers from growing balances. Benefits from the SAVE plan will start this summer.
