The Biden Administration approved debt relief for more student loan borrowers, totaling $9 billion in forgiveness. This is the latest effort by President Biden to offer relief to what the White House calls a “broken student loan system.”
This forgiveness will apply to 125,000 borrowers. The cancellations come through three different existing debt relief programs that have been plagued with problems in the past.
- 53,0000 borrowers will get debt cancellation under the Public Service Loan Forgiveness Program, which wipes away remaining student loan debt for qualifying public sector workers after 10 years of monthly payments.
- 51,0000 borrowers who’ve been in income-driven repayment for the last 20 years will get their debts canceled after a recount of their past payments.
- 22,0000 borrowers with a total or permanent disability are approved for an automatic debt discharge.
“Because of administrative failures some people who did pay their loans for 20 years or more, did not get the debt relief they’d earned,” President Biden said Wednesday. “We fixed that and made sure borrowers got credit for every single payment they made.”
Most were already eligible for cancellation through programs like the Public Service Loan Forgiveness for people working as teachers, health care workers, and the military but never got it. It also discharges for those with disabilities, and for those who have been paying for two decades or more.
The cancellations will only benefit about 40,000 people in Florida but 28 million borrowers are getting ready to make payments for the first time in three years. News4JAX producer Erin Seaton is one of them.
“I owe just over $8,800 in student loans I haven’t paid,” Seaton said. “So I graduated in May of 2021. And I haven’t paid since I graduated. So this will be my first payment in two years, and I owe my first payment is coming out to about $87.”
We first talked with her about her debt when she thought it would be completely wiped. That was before the Supreme Court decision blocking one-time student debt relief.
She’s no longer counting on getting any student loan forgiveness but is planning to make some lifestyle changes so she can afford her monthly student loan payment.
Jordan Smith also has student debt he’s paying off after studying journalism at the University of Florida. He supports debt cancellation even if it won’t benefit him.
“I don’t think something necessarily has to benefit me personally, for it to be, you know, a good thing or for the greater good of our country,” Smith told News4JAX. “I think, especially in the public service space, individuals with disabilities, or, if you’re just put out of work, and you simply can’t afford to, you know, pay your student loans, you shouldn’t have to decide between defaulting on a loan or paying rent that month.”
If you think you’re eligible for cancellation, White House officials say to look out for an email from your loan servicing company.
You should only apply for loan deferments, forbearance, repayment, forgiveness, or discharge programs directly through the U.S. Department of Education or your loan servicer. There is no cost to apply.
This is a hot topic and we want to hear from you. Why are you for or against student loan debt relief? Answer in the form below and your response may be read on a Channel 4 newscast.