According to the US Department of Education, President Joe Biden has approved $1.2 billion in student loan forgiveness for approximately 153,000 borrowers. This announcement applies to borrowers eligible for forgiveness under Biden’s initiative known as the Saving on a Valuable Education (SAVE) Plan. The Biden-Harris administration introduced this plan in August last year to expedite the process of loan forgiveness.
Under this initiative, individuals who borrowed $12,000 or less and have been making payments for over a decade are eligible for relief. Miguel Cardona, the US Secretary of Education, commented on the approval, stating that it sends a clear message to student loan borrowers. He further emphasised that those who have diligently repaid their debt for a decade deserve relief, noting that the administration has now approved loan forgiveness for nearly 3.9 million borrowers.
Through Biden’s SAVE plan, it is projected that 85 percent of future community college borrowers will be debt-free within ten years. The administration has already begun emailing eligible borrowers on Wednesday, informing them that they no longer need to take any additional steps to receive loan relief. Additionally, loans for borrowers who qualify under the plan will be automatically canceled without requiring any action on their part.
To date, over 7.5 million people have enrolled in the SAVE Plan, with 4.3 million students not having made any monthly income. According to the data from the Department of Education, significant amounts have been forgiven. The loan relief includes $56.7 billion for over 793,000 borrowers through fixes to the Public Service Loan Forgiveness (PSLF) program. Moreover, $45.6 billion is given to over 930,000 borrowers through improvements to income-driven repayment plans.
Not only this, $22.5 billion is forgiven for 1.3 million borrowers through closed school discharges, borrower defense, and court settlements.
