The Biden administration is canceling student loans for another 160,000 borrowers through a combination of existing programs.
The Education Department announced the latest round of cancellation on Wednesday, saying it will erase $7.7 billion in federal student loans. With the latest action, the administration said it has canceled $167 billion in student debt for nearly 5 million Americans through several programs.
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The latest relief will go to borrowers in three categories who hit certain milestones that make them eligible for cancellation. It will go to 54,000 borrowers who are enrolled in Biden’s new income-driven repayment plan, along with 39,000 enrolled in earlier income-driven plans, and about 67,000 who are eligible through the Public Service Loan Forgiveness program.
I think it sounds better if this were just about how Biden’s plan is rolling out eligibility for 54,000 borrowers. Though it is a payment plan that results in forgiveness like the PSLF.
The thing about the PSLF is that it was supposed to erase debt for public service employees after 10 years of aervice and no missed payments. So when Bush signed it in 2007, people who came eligible for forgiveness under Trump starting in 2017 were denied over absolutely insane technicalities.
So he gets credit for those 67,000 and 39,000 borrowers only in that they were essentially denied forgiveness they already qualified for up until now. Honestly I think focusing on the new stuff and not a Bush era program hits better.
I can understand the perspective, but if the Trump administration deliberately interfered with the PSLF, then it’s a fair point in the obvious goal (to contrast his approach versus Trump’s). Of course, conveniently they waited for an election year, when they could have done this in 2021…
Problem then was covid: payments were paused so people who were 9 years and 10 months into paying under the program were left in an awkward limbo.
So now that covid emergency is “over” those kinds of cases are finally being reviewed over the period of time payments were paused.
My spouse had the clock on “10 years” reset because of a missed payment in 2015. Would have had them discharged in 2022, but now we are on track for 2025, unless the covid pause will delay how those 10 years are tracked to 2027 or later.
COVID non-payment periods counted towards the 10 years. Anyone who was 9 years and 10 months would become eligible at 10 years, even if they didn’t have to make the last two payments.