Education Department Announces $9 Billion in Student-Debt Relief for Borrowers
President Joe Biden’s Education Department has recently announced $9 billion in student-debt relief for targeted groups of borrowers. This relief comes as federal borrowers are facing monthly bills after a hiatus.
The debt cancellation includes $5.2 billion for 53,000 borrowers in the Public Service Loan Forgiveness program, $2.8 billion for 51,000 borrowers who made the required payments on income-driven plans, and $1.2 billion for 22,000 borrowers with permanent disabilities approved for debt relief by the Social Security Administration.
Education Secretary Miguel Cardona stated that millions of qualifying borrowers can now access the student debt relief, thanks to the Biden-Harris administration’s focus on reducing red tape and addressing administrative failures. The Education Department has approved a historic $127 billion in debt relief for nearly 3.6 million borrowers.
While changes to repayment programs have aimed to provide relief, borrowers have faced challenges such as long hold times and inaccurate billing statements. The Department is working on reforms to ease the transition back into repayment, including a 12-month grace period with no reported missed payments and the introduction of the SAVE plan for affordable income-driven repayment.
In addition, the Education Department is developing a new broad student-debt relief plan after the Supreme Court rejected Biden’s initial proposal. Details are being released on how the plan will be crafted and who will be eligible for relief.
