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55,000 More Borrowers Receive Student Loan Forgiveness
Source: The College Investor
Key Points
- The Biden administration announced $4.28 billion in student loan forgiveness for 54,900 public service workers.
- Total student debt relief under this administration now approaches $180 billion, benefiting nearly five million borrowers.
- The announcement follows significant improvements to the Public Service Loan Forgiveness (PSLF) program, aimed at supporting public servants.
The Biden administration announced another $4.28 billion in student loan forgiveness, benefiting nearly 55,000 borrowers working in public service. This milestone stems from efforts to improve the Public Service Loan Forgiveness (PSLF) program, which had previously faced widespread criticism for its failures.
The announcement brings the total debt relief approved under this administration to nearly $180 billion, assisting 4.9 million Americans. This includes $78 billion allocated through the PSLF program alone.
In the statement, Education Secretary Miguel Cardona hailed the accomplishment, emphasizing the administration’s focus on delivering meaningful relief to working families.
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Public Service Loan Forgiveness
The PSLF program forgives remaining student loan balances for public service workers after 120 qualifying payments. The plan has three main requirements to qualify:
- Have Direct Student Loans
- Have A Qualifying Repayment Plan
- Work In Public Service And Certify Your Employment For 120 Payments (roughly 10 years)
Recent reforms, such as improved tracking tools on StudentAid.gov and the removal of barriers to participation, have made the program more accessible.
The program got off to a rocky start, with the first year of eligible borrowers achieving the 120 payment milestone only seeing about 1% receiving loan forgiveness. The Biden Administration worked to improve the outcomes of PSLF borrowers, now seeing over 1,000,000 borrowers receiving loan forgiveness under this plan.
It’s important to note that PSLF does require work by the Department of Education, not just loan servicers, so if the government does shut down this week, PSLF approvals will also stop while the government is shutdown.
Biden Administration Student Loan Relief
President Biden has forgiven the most student loans to-date. The Administration has approved nearly $180 billion in student debt relief for 4.9 million borrowers through various actions.
Beyond PSLF, actions include relief for borrowers affected by school closures or misleading practices, one-time forgiveness under the SAVE repayment plan, and other changes to income-driven repayment plans.
Related: Will The SAVE Plan Survive Legal Challenges?
What Borrowers Need To Know
It’s important to remember that President Biden didn’t take any new action with this round of loan forgiveness. These borrowers were already doing the proper steps for PSLF for the last decade.
It’s also important to note that PSLF is not a new program by the Biden Administration. It was signed into law by President Bush in 2007 as part of the College Cost Reduction and Access Act of 2007.
The current legal challenges are for programs created by the Department of Education through executive action, not laws passed by Congress. While SAVE is being challenged, PSLF is not. And while PSLF could be repealed by Congress in the future, it’s not likely to impact existing borrowers.
Finally, it’s important to note that President Trump cannot claw-back already granted loan forgiveness.
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