Biden administration announces $39 billion in student debt relief for 804,000 borrowers
By The Citizen on July 14, 2023
The Biden administration has announced that it will provide $39 billion in total student debt relief for 804,000 borrowers, its latest step since President Biden’s student loan forgiveness plan was struck down by the Supreme Court.
The Education Department said Friday the relief is being provided on income-driven repayment plans, in which the federal government cancels remaining balances for the borrower after they have made their payments for 20 or 25 years.
The department said the “fixes” will more accurately count monthly payments that qualify under the plans, and it will notify borrowers who are eligible for the relief in the upcoming days.
The Supreme Court struck down Biden’s plan to give $10,000 of student debt relief to low- and middle-income borrowers and up to $20,000 for Pell Grant recipients in a 6-3 decision last month. The majority found Congress had not directly authorized the president to forgive debts worth hundreds of billions of dollars.
US President Joe Biden walks backdropped by Marine One upon arriving at Stansted airport, in London, Monday, July 10, 2023. (AP Photo/Susan Walsh)
Biden announced after the decision that his administration would continue to work to provide student debt relief despite the court’s ruling. He said he would base his debt relief plan on a different law, the Higher Education Act, which proponents argue allows the education secretary to “compromise, waive or release” student loan debt.
The administration must undergo a public comment period before the plan can go into effect, delaying its potential implementation.
The Hill has reached out to the White House for comment on Friday’s announcement.
Vice President Harris said in a statement that she and Biden are “committed” to providing relief to student borrowers.
“Our Administration will continue to fight to make sure Americans can access high-quality postsecondary education without taking on the burden of unmanageable student loan debt,” she said.
Harris said many of the borrowers eligible for the relief were placed in forbearance by loan servicers against the rules of the payment plan, and others did not receive credit for monthly payments they made.
“For far too long, borrowers fell through the cracks of a broken system that failed to keep accurate track of their progress towards forgiveness,” Education Secretary Miguel Cardona said in a statement.