The Biden administration is canceling about $4.9 billion in student loan debt for 73,600 borrowers, the Department of Education announced Friday.
The $4.9 billion in canceled student loans includes $3.2 billion for 43,900 borrowers through the Public Service Loan Forgiveness waiver, and $1.7 billion for 29,700 borrowers through administrative adjustments to income-driven repayment plans, according to a news release. These student loan discharges are the result of fixes to both PSLF and IDR programs, according to the release.
Among the 73,600 borrowers affected by these loan cancellations, about 44,000 of them are public service workers such as firefighters, nurses and teachers, and about 30,000 of them are borrowers who have been in repayment for at least 20 years “but never got the relief they earned through income-driven repayment programs,” President Biden said in a statement.
“My Administration is able to deliver relief to these borrowers – and millions more – because of fixes we made to broken student loan programs that were preventing borrowers from getting relief they were entitled to under the law,” Biden said.
With Friday’s announcement, the Biden-Harris administration to date has canceled $136.6 billion in student loans for more than 3.7 million Americans, according to the release.
“The Biden-Harris Administration has worked relentlessly to fix our country’s broken student loan system and address the needless hurdles and administrative inaccuracies that, in the past, kept borrowers from getting the student debt forgiveness they deserved,” U.S. Secretary of Education Miguel Cardona said in the release. “The nearly $5 billion in additional debt relief announced today will go to teachers, social workers, and other public servants whose service to our communities have earned them Public Service Loan Forgiveness, as well as borrowers qualifying for income-driven repayment forgiveness because their payments are for the first time being accurately accounted for.”
Earlier this month, the U.S. Department of Education announced it will provide student loan forgiveness to some borrowers enrolled in President Biden’s SAVE Plan beginning in February. The Department will cancel student debt balances for borrowers who meet the following criteria: are enrolled in SAVE; have made payments for 10 or more years; and originally took out $12,000 or less in student loans, according to a news release. Eligible borrowers will have their debts canceled immediately without any action needed on their end, and the Department will notify eligible borrowers that their loans are being discharged automatically.
Also earlier this month, about 758,000 student loan borrowers were placed into forbearance due to billing errors by student loan servicers, the Department announced. Three student loan servicers – Aidvantage, EdFinancial and Nelnet – all failed to send timely billing statements to the combined 758,000 borrowers ahead of the first month of repayment, which began Oct. 1, according to a news release. The billing errors broke contractual obligations set forth by the Department, leading to financial repercussions for the three servicers.