In a significant effort to ease the burden of student loan debt, the United States Department of Education has announced that over 800,000 federal student loan borrowers will receive automatic loan relief. The decision was made to relieve the financial burdens of people who have been struggling with loan duties during the economic difficulties caused by the pandemic.
The relief measures, which were announced by the Department of Education on July 18, are aimed at offering critical support to students who have been struggling to make ends meet as a result of the economic downturn. Applicants for the automatic loan relief include debtors with Direct Loan Programme and Federal Family Education Loan (FFEL) Programme loans.
As per the latest data, the majority of student loan borrowers who were approved for this relief include a total of 63,730 from Texas. The table below indicates the number of debtors automatically discharged:
|States||Number of debtors||Debt cancellation (in millions)|
This temporary suspension of loan payments will provide eligible borrowers with an instant break and financial relief.
Joe Biden, President of the US, announced in a statement that, “Starting today, over 800,000 student loan borrowers who have been repaying their loans for 20 years or more will see $39 billion of their loans discharged because of steps my Administration took to fix failures of the past.”
The Department of Education encouraged debtors to stay aware of the details of the automated loan relief programme and to contact the loan servicers for any clarifications or guidance that may be required.
Under Biden’s plan, over 40 million borrowers can see $10,000 to $20,000 in student loans cancelled. However, the Supreme Court blocked Biden’s proposal to forgive student debt in a 6-3 decision last month, following several lawsuits attempting to end the proposal.