Biden student loan forgiveness overview:ย
- Who: The Department of Education announced last week it would be forgiving $39 billion in federal student loans for 804,000 borrowers who have income-driven repayment plans.ย
- Why: The agency said it decided to automatically forgive the student loans to ensure the borrowers have an accurate count of the number of monthly payments needed to qualify for forgiveness under the plans.ย
- Where: The decision affects certain federal student loan borrowers nationwide.
President Joe Bidenโs administration said last week it is set to provide 804,000 borrowers with $39 billion in automatic student loan forgiveness as a result of fixes to income-driven repayment plans.ย
The Department of Education will begin notifying eligible federal student loan borrowers that their loans will be automatically discharged in the coming weeks, according to a release published on the agencyโs website July 14.ย
The Department of Education said it decided to automatically forgive the student loans to โensure all borrowers have an accurate count of the number of monthly payments that qualify toward forgiveness under income-driven repayment (IDR) plans.โย
โFor far too long, borrowers fell through the cracks of a broken system that failed to keep accurate track of their progress towards forgiveness,โ U.S. Secretary of Education Miguel Cardona said in a statement.ย
Department of Education says it is committed to fixing โhistorical failuresโ with running of income-driven repayment plans
The Department of Education said the decision was part of its commitment to fix โhistorical failuresโ in the running of the federal student loan program in which a qualifying payment made under an IDR plan should have, but didnโt, move a borrower closer to forgiveness.ย
Federal student loan borrowers who participate in the program become eligible for forgiveness once they have accumulated either the equivalent of 20 or 25 years of qualifying months, the agency said in the release.ย
โBy fixing past administrative failures, we are ensuring everyone gets the forgiveness they deserve, just as we have done for public servants, students who were cheated by their colleges, and borrowers with permanent disabilities, including veterans,โ Cardona said.ย
Borrowers who should expect to receive notifications of student loan forgiveness in the coming days include individuals with Direct Loans or Federal Family Education Loans currently held by the Department of Education, and who have received the necessary forgiveness threshold under certain periods.ย
In other student loan forgiveness news, the U.S. Supreme Court ruled earlier this month that the Biden administration would not be allowed to move forward with a $430 billion student loan forgiveness plan, calling it government overreach.ย
Do you qualify for federal student loan forgiveness? Let us know in the comments!
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9 thoughts onBiden administration to forgive $39B in student loans
Heaven Forbid we teach our young adults the concept of financial responsibility and sacrifice. Debt is not a sin to be forgiven; it is a business decision that comes with eventual consequences.
I have three daughters who applied for student forgiveness then they now owe again. Only one daughter who is disabled had federal loans forgiven through the financial aid department through the loan servicer.
A major issue is that the former Betsy Devos allowed the Dept of Education to garnish Social Security from a past student loan borrower. When you only get $700/mo, they shouldnโt be able to take $137/mo when it is old interest and not even the principal of a $1200 loan from the 70โs. Its unbelieveable the horror stories I hear from seniors who live dollar to dollar. There is room for forgiveness in Student Loans based on predatory lenders who inflicted ridiculous interest rates, and resold the loan again and again.
I want to know how it is okay that I was sent an email saying my loans were forgiven and now they suddenly are not! If I was forgiven then I am forgiven.
I like to know if I qualify
I payed back the student loan, what about the ones that have.
I have student loans that I cannot afford to pay back. I am currently receiving disability and assisting my daughter through college and raising my two grandchildren. I will believe all these stories about student loan forgiveness when I receive a letter in my mailbox with strong evidence stating that my loans no longer exist.
What about the millions of people that paid back their loans???
I have student loan debt, but donโt know where to signup, I could no longer pay after having a craniotomy for a large brain aneurysm. I have 3 more aneurysms that will be operated on once they reach a certain size. I have daily migraines and am noble to work