Biden Administration Announces $42 Billion in Approved Public Service Loan Forgiveness
New Plan Eliminates Accrued Interest on Loans for 23 Million Borrowers
77,700 Borrowers to Receive Full Debt Cancellation Under SAVE Plan Policy
The Biden administration announced on Thursday that it is forgiving almost $6 billion in student debt for 77,700 borrowers. The borrowers receiving relief are the first to benefit from a SAVE plan policy that provides debt forgiveness for public service workers after 10 years of service.
In the coming days, servicers will process the forgiveness and borrowers will see their loans discharged. The Public Service Loan Forgiveness (PSLF) Program allows public service workers to receive forgiveness of the remaining balance on their federal student loans after 10 years of qualifying service.
The Biden administration's announcement is part of a broader effort to address the student loan crisis. In August, the administration announced that it would forgive up to $20,000 in student debt for borrowers who meet certain income requirements. The new plan would eliminate accrued interest on loans for 23 million borrowers and cancel the full amount of debt for 77,700 borrowers.
The Department of Education has also announced that it will be making changes to the PSLF program to make it easier for borrowers to qualify. These changes include allowing borrowers to consolidate their loans into a single Direct Loan and counting all payments made on federal student loans, regardless of the loan type.
The Biden administration's actions are a significant step forward in addressing the student loan crisis. However, some advocates argue that more needs to be done to provide relief to borrowers who are struggling to repay their loans.
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