Joe Biden Forgives $39 Billion In Student Loan Debt For 800,000 Borrowers
The U.S. Department of Education recently announced that it will soon begin to notify close to 804,000 borrowers that the $39 billion in Federal student loans will be forgiven automatically for those who have been paying down their debts for 20 years or more. The department said that the borrowers were suffering because of the broken system that simply failed to keep proper records of the Income-Driven Repayment (IDR) plans.
Right the wrong
"Today, the Biden-Harris Administration is taking another historic step to right these wrongs and announcing $39 billion in debt relief for another 804,000 borrowers," U.S. Secretary of Education Miguel Cardona said in a statement, reports Fox Business.
Cardona also talked about how they are trying to fix past administrative failures and ensure that everyone gets the forgiveness that they deserve.
"This Administration will not stop fighting to level the playing field in higher education," Cardona added.
The department said that these discharges are a result of solutions that were implemented by the Biden-Harris Administration "to ensure all borrowers have an accurate count of the number of monthly payments that qualify toward forgiveness under IDR plans."
Vice President Kamala Harris said in a statement that she and the President "are committed to delivering relief to student loan debt borrowers to help them move forward with their lives..."
She also said that they have more plans to pursue an alternative path that will provide aid through the Higher Education Act.
Harris said that the administration has finalized a new IDR plan that will cut monthly in half for undergraduate loans. "Our administration will continue to fight to make sure Americans can access high-quality post-secondary education without taking on the burden of unmanageable student loan debt," she concluded.
What happened with the IDR plans?
The higher education act and the education department regulations say that the borrower can get forgiveness after making payments regularly for more than two decades. The Biden administration said that they have decided to discharge loans now after the "historical failures" in how the IDRs were maintained.
Some "qualifying payments made under IDR plans that should have moved borrowers closer to forgiveness were not accounted for," as per the administration.
How do I check my debt relief?
The eligible borrowers are getting notified. If you think you might be qualified, the forgiveness should reflect in the account. It's important to keep in mind that this announcement is only meant for IDR plans who have struggled to get forgiveness despite 20 years of payments.
Biden administration under pressure to deliver
The Biden administration is trying everything to reduce student loan debts for Americans. However, after the Supreme Court's decision, which said that the administration was not equipped to tackle the large-scale student loan issue. The administration is now trying to forgive debt through the Higher Education Act of 1965.
The plan will start on Tuesday through a procedure known as negotiated rulemaking. Members of the public will be able to share their feedback on if they want the Education Department to use the Higher Education Act or not.
This is not the first time Biden Administration is forgiving debts. Back in 2022, they agreed to relieve loans of 200,000 borrowers who had been defrauded by the colleges. This relief plan also relied on the Higher Education Act which gives the education secretary the "power to pay and force compromise, waive, or release any right, title, claim, lien, or demand."