President Joe Biden declared on Friday that some students who took out modest loans and have been making payments for the previous ten years will have their federal student debt forgiven.
In February, Biden stated in a statement, “borrowers who received less than $12,000 in federal loans and have been paying off their balances for at least 10 years will get their remaining student debt cancelled immediately.”
He stated that the action is “nearly six months ahead of schedule” and that it affects borrowers who are registered in SAVE, the new income-driven repayment plan that administration officials have been promoting as a means of assisting borrowers in reducing their monthly payments.
Although 30 million individuals are eligible for the SAVE plan, 6.9 million people are registered as of Friday, according to Biden. The number of borrowers who would be impacted by the cancellation effort was not immediately apparent.
“This action will particularly help community college borrowers, low-income borrowers, and those struggling to repay their loans,” Biden said in the press release.
After a break of more than three years, many borrowers started making their federal student loan repayments in October.
Biden’s pandemic-era debt relief plan, which sought to eliminate up to $20,000 in student debt for around 43 million borrowers, was rejected by the Supreme Court last year.
Biden noted that 3.6 million people’s college debt has already been forgiven as a result of the administration’s efforts to “pursue an alternative path” in his remarks.
The statement on Friday comes after similar steps to lower student loan debt have been taken in previous months.
Biden approved $9 billion in student loan debt forgiveness for 125,000 individuals, including 53,000 recipients of the Public Service Loan Forgiveness programme, shortly after loan repayments resumed in October.
Subsequent to the commencement of that month, the Education Department unveiled a plan that purported to offer debt relief to four groups of borrowers, among them those whose balances on federal student loans beyond the initial amounts borrowed.
