More Student Loan Debt Eliminated; $5 Billion In Payments Adjusted – Forbes Advisor

The Biden administration has approved another $4.9 billion in student loan debt relief for more than 70,000 borrowers, including teachers, social workers and other public servants, according to the Department of Education.

This latest round of forgiveness stems from adjustments to income-driven repayment (IDR) and Public Service Loan Forgiveness (PSLF) plans.

The plan, announced Friday, mirrors a similar initiative in December that will provide $4.8 billion in debt relief to 80,300 borrowers through IDR and PSLF fixes. And last week, the White House fast-tracked its Saving on a Valuable Education, or SAVE, program to begin debt cancellation efforts in February.

How Much Student Loan Debt Has Been Eliminated?

Efforts to cancel student debt have been ongoing since President Joe Biden’s original plan to eliminate more than $400 billion in student loan debt was rejected by the Supreme Court last year. Since then, total loan forgiveness offered by the Education Department has reached $136.6 billion for more than 3.7 million qualified borrowers.

In a statement, U.S. Under Secretary of Education James Kvaal said that the Biden administration is “not going to stop until we’ve helped all of those harmed by the broken student loan system.”

How Will the Latest Loan Forgiveness Be Distributed?

The latest discharge of student loan debt will fall into two categories, according to the Department of Education

• More than 29,000 borrowers will receive $1.7 billion through adjustments to IDR payments that count toward forgiveness. They also address what the Department of Education describes as “longstanding concerns with the misuse of forbearance by loan servicers.” This effort brings the IDR relief sum to $45.7 billion for 930,500 borrowers.

• Almost 44,000 borrowers will get $3.2 billion through the PSLF program, including those who benefited from the administration’s PSLF waiver. The waiver allowed borrowers to receive credit for repayment periods that previously didn’t count toward forgiveness. This brings the PSLF relief total to $56.7 billion for more than 793,000 borrowers since October 2021.