Biden administration forgives another $9 billion in student loan debt. Who’s eligible?
Days after student loan payments resumed for the first time in more than three years, President Joe Biden is canceling an additional $9 billion in student debt.
The Oct. 4 announcement marks the administration’s latest attempt at following through on student loan relief months after Biden’s initial plan was struck down by the U.S. Supreme Court. Officials said the latest round of relief is the result of “fixes” to existing programs.
Here’s what to know about the latest student loan debt relief.
Who is eligible for forgiveness?
Officials said 125,000 borrowers among three different existing programs will receive relief.
Of that total, 53,000 borrowers will receive $5.2 billion in relief under Public Service Loan Forgiveness programs. PSLF programs discharge any remaining debt for public sector workers who have made 10 years of qualifying monthly payments and are employed full-time by eligible employers.
An additional 51,000 borrowers will see nearly $2.8 billion forgiven due to fixes to income-driven repayment plans. This will impact borrowers who have been on an income-driven repayment plan for at least 20 years but have yet to see their loans discharged.
Another 22,000 borrowers who have been identified as having a total or permanent disability through a data match with the Social Security Administration will receive $1.2 billion in relief.
How does the White House keep canceling student debt?
The Supreme Court struck down the Biden administration’s initial one-time student loan debt forgiveness plan in a June 30 ruling.
That plan, announced in August 2022, would have given student loan borrowers a one-time discharge determined by their annual income and household size.
Despite the Supreme Court’s decision, officials have continued providing debt relief to student loan borrowers.
In June, the administration discharged $39 billion in student loan debt by fixing income-driven repayment plans. In August, a new income-driven repayment plan, known as the Saving on a Valuable Education (SAVE) plan, was introduced.
After the new revisions, the Biden administration has now forgiven $127 billion in student debt for about 3.6 million borrowers, according to the White House.
So how does that relief not violate the recent Supreme Court Decision? In short: The latest actions relieving student loan debt are separate from Biden’s original plan introduced in August 2022.
Instead, officials are just making adjustments to existing plans instead of proposing new legislation, which the Supreme Court ruled was necessary to enact sweeping forgiveness of student debt like the one Biden had attempted through executive action.
What’s next for student loan borrowers?
The U.S. Department of Education released its initial set of policy considerations to create a debt relief plan for student loan borrowers in need, according to a Sept. 29 news release.
“We are diligently moving through the regulatory process to advance debt relief for even more borrowers,” U.S. Secretary of Education Miguel Cardona said in the release. “After considering more than 26,000 public comments on how to tailor this relief, we are releasing this additional information about this effort.”
The Student Loan Relief Committee will discuss the issue paper at their first meeting on Oct. 10 and 11, officials said.
This story was originally published October 4, 2023 at 3:36 PM with the headline "Biden administration forgives another $9 billion in student loan debt. Who’s eligible?."
