EconomyUS News

Biden Forgives $7.4 Billion in Student Loans for Over 277,000 Borrowers

President Joe Biden has declared the cancellation of $7.4 billion in student debt for over 277,000 individuals.

Following his announcement of a proposal to assist millions of Americans in repaying student loans, the “Plan B” seeks to fulfill a campaign pledge prior to the November election. So far, the Biden-Harris Administration has forgiven $153 billion in debt for 4.3 million individuals. The most recent wave of debt relief will be divided into three distinct categories.

  • Approximately 206,800 borrowers enrolled in the government’s Saving on a Valuable Education (Save) repayment plan will receive $3.6 billion.
  • Around 65,800 borrowers utilizing income-driven repayment plans are set to receive $3.5 billion.
  • Additionally, $300 million will be allocated to 4,600 borrowers through adjustments to the Public Service Loan Forgiveness program.

The Department of Education will begin notifying those affected by the cancellations via email starting on Friday. Relief processing will occur in the following weeks, as stated by the department.

US Under Secretary of Education James Kvaal affirmed that borrowers have met their payment obligations and deserve loan forgiveness for the remaining balance of their loans. The White House stated its commitment to exploring all available avenues to provide relief for student debt to as many Americans as possible.

Last year, the US Supreme Court blocked President Biden’s initial proposal to eliminate $430 billion in student debt, which would have cleared the debts of approximately 20 million individuals. The court ruled that Biden lacked the authority to enact such a sweeping cancellation without Congress’s approval.

Since then, the White House has utilized existing provisions to cancel billions of dollars in debt while also pursuing other reforms within the student loan system.

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