More student debt relief is in the works as Biden prepares to leave office. (iStock)
As President Joe Biden's term draws to a close, he granted federal student loan relief to an additional 150,000 borrowers.
These 150,000 borrowers include approximately 85,000 students who attended schools that defrauded students, 61,000 borrowers with total and permanent disabilities, and 6,100 government employees. It is. With this debt forgiveness, the number of students whose student loans were canceled during his administration now stands at more than 5 million. According to a White House announcement.
The latest wave of debt relief includes 6,100 borrowers who received $465 million in debt forgiveness through the Public Service Loan Forgiveness (PSLF) program. This proves that such programs have the potential to reduce the burden of student debt.
“Identifying 5 million students for student loan forgiveness means the federal government is finally keeping its promise,” said James Kvar, U.S. Undersecretary of Education. said. “People who can’t afford student loans because they hold public office, have a disability, were defrauded by their university, or have had decades of repayments will receive the promised relief. These permanent reforms will continue for more and more borrowers every year. “
If you want to pay off your private student loan debt, refinancing can reduce your interest rate and monthly payments. To find out if this is the right option for you, contact Credible to speak with a student loan expert and have your questions answered.
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Approval of new student loan forgiveness
The Supreme Court previously blocked the Biden administration's plan to expand student loan forgiveness. In 2023, the court blocked the administration from issuing $400 billion in debt forgiveness that would affect more than 40 million borrowers.
In August, the Supreme Court blocked another government proposal to lower monthly payments and speed up loan forgiveness. Biden introduced SAVE after the Supreme Court struck down his student loan forgiveness plan. of The White House said: It claimed that the SAVE plan could lower borrowers' monthly payments to $0, cutting monthly costs in half and potentially saving people making payments of at least $1,000 a year.
Biden administration canceled the plan The plan is to announce an alternative student debt cancellation plan in December. Despite losing in the Supreme Court, the government forgave about $183.6 billion in student loans thanks to the amendment. Implemented to handle PSLF applications and approve the discharge. The total number of borrowers approved for PSLF is now 1.069 million, worth $78.46 billion, compared to 7,000 borrowers receiving PSLF when the Biden-Harris administration took office, according to the Department of Education.
In addition, the government approved $56.5 billion in debt relief to more than 1.4 million borrowers through income-driven repayments, including the SAVE plan, the “Precious Education Savings.” Some borrowers also have access to an additional $900 in Pell Grants to help pay for school costs. Additional debt that will be forgiven includes student debt of borrowers whose schools have committed fraud, whose schools have suddenly closed, or who have been subject to related court settlements.
Private student loan borrowers cannot benefit from federal loan relief. However, you can reduce your monthly payments by refinancing to a lower interest rate. Visit Credible to talk to experts and get your questions answered.
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Debt forgiveness may be blockedUntil now
Republican Rep. Glenn Grossman (R-Wis.) introduced a bill in the last Congress that would effectively block future large-scale student loan cancellation plans. of Protecting taxpayers from the Student Loan Relief Act Prohibits the Secretary of Education from enacting regulations or administrative actions that increase the cost of federal student loan programs.
The bill was eventually incorporated into the College Cost Reduction Act, but it never received a vote in the House.
“Congress could still consider taking steps to block debt forgiveness by future administrations,” said Preston Cooper, a senior fellow at the American Enterprise Institute. blog post.
Cooper said Republicans may not want to jeopardize the incoming Democratic administration's chances of successfully pursuing a loan cancellation strategy that is less likely to face legal challenges.
Those with private student loans may be able to find relief by refinancing and reducing their monthly payments. Online tools like Credible allow you to compare student loan refinance rates and find the best deal before you apply.
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