President Joe Biden unveiled a new round of student loan debt forgiveness on Thursday, totaling $5.8 billion, benefiting nearly 78,000 public-sector workers. These borrowers will receive congratulatory emails from Biden next week, along with an additional 380,000 individuals who may be eligible for future debt relief.
The forgiveness program, known as Public Service Loan Forgiveness (PSLF), targets qualifying borrowers such as teachers, social workers, nurses, doctors, and government lawyers. Eligible individuals can have their student debt canceled after making 10 years of monthly payments.
The emails from Biden aim to encourage borrowers to continue their careers in public service, reminding them of their progress towards debt forgiveness. The administration is eager to highlight its efforts in providing student loan relief, especially in an election year, despite setbacks such as the Supreme Court’s rejection of its broader student loan forgiveness program last year.
Although the proposed program would have canceled up to $20,000 for low- and middle-income borrowers, totaling an estimated $430 billion in debt relief, the Biden administration has still managed to cancel $144 billion in federal student loan debt for nearly 4 million borrowers to date. This relief has primarily been achieved through existing student loan forgiveness programs targeting specific groups of borrowers.
The expansion of PSLF under Biden’s tenure has been significant, addressing administrative challenges that hindered the program’s effectiveness. With only 7,000 people having received debt relief under PSLF prior to Biden’s presidency, the administration has implemented temporary waivers and retroactive eligibility expansions to rectify past issues.
Furthermore, a one-time recount of borrowers’ past payments is underway to correct past administrative failures, providing credit toward forgiveness for months in which payments were made, regardless of the repayment plan enrolled in at the time. This initiative particularly benefits borrowers who may have been misled into long-term forbearance by their loan servicing companies.
In addition to PSLF, Biden’s administration has leveraged existing student loan forgiveness programs, such as borrower defense to repayment and automatic discharges for permanently disabled borrowers. The newly introduced income-driven repayment program, SAVE, has also provided relief to nearly 153,000 borrowers.