WASHINGTON D.C., DC — The weight of student debt got a bit lighter for 160,500 borrowers who were impacted by the $7.7 billion in additional student loan debt relief that was announced by the Biden-Harris Administration on Wednesday.
According to a release from the U.S. Department of Education, the discharges are available for borrowers who are receiving Public Service Loan Forgiveness, or PSLF, those who signed up for President Joe Biden’s Saving on a Valuable Education Plan, or SAVE, and who are eligible for its shortened time-to-forgiveness benefit and lastly for those who are receiving forgiveness on income-driven repayment, or IDR, as a result of fixes made by the administration.
With the announcement, the administration has approved $167 billion in loan forgiveness for 4.75 million U.S. residents, which has impacted one out of every 10 federal student loan borrowers, the release said.
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U.S. Secretary of Education Miguel Cardona, a Connecticut native, said in the release that the administration remains persistent about its efforts to bring student debt relief to millions of people throughout the country.
“This announcement proves it,” Cardona said in the release. “One out of every 10 federal student loan borrowers approved for debt relief means one out of every 10 borrowers now has financial breathing room and a burden lifted.”
The U.S. Department of Education also recently announced an update on the timing of the payment count adjustment, ensuring that borrowers get credit toward IDR forgiveness and PSLF. The release said that borrowers who would benefit from consolidating now have until June 30 to apply to do so. They can find out more about the payment count adjustment here.
Breaking Wednesday’s announcement down, $5.2 billion will go toward 66,900 borrowers through fixes to PSLF; the administration has now approved $68 billion in forgiveness for more than 942,000 borrowers through PSLF, according to the release.
An additional $613 million will impact 54,300 borrowers through the SAVE Plan; the release said $5.5 billion has been approved under the SAVE Plan, impacting 414,000 borrowers. Also, a total of $1.9 billion will go toward 39,200 borrowers through administrative adjustments to IDR payment counts. The administration has now approved $51 billion in IDR relief for more than a million borrowers, according to the release.
A report by the Council of Economic Advisers cited in the release said the relief provided by the latest announcement and other actions taken by the administration could boost short-term consumption and have positive effects on borrower mental health, financial security and outcomes such as homeownership and entrepreneurship.
According to the release, the administration has revealed new plans to provide student debt relief for tens of millions of borrowers across the country, bringing the total number of borrowers eligible to 30 million, including borrowers who have already been approved for debt cancellation by the Biden-Harris Administration over the past three years.
The proposal would permit waivers including accrued and capitalized interest for millions of borrowers, automatically discharging debt for borrowers not enrolled in but otherwise eligible for loan forgiveness under the SAVE Plan, closed school discharge or other forgiveness programs, the elimination of student debt for borrowers who entered repayment 20 or more years ago, help for borrowers who enrolled in low-financial-value-programs or institutions and assisting borrowers who experience hardship in paying.
The release said the Department of Education is reviewing the plan and hopes to publish a final rule that results in delivering relief in the fall.
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Dalton Zbierski is a digital content producer and writer at FOX61 News. He can be reached at dzbierski@FOX61.com.
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