Biden to forgive $5.8 billion in student debt for nearly 78,000 borrowers

U.S. President Joe Biden announces a preliminary agreement with Intel for a major CHIPS and Science Act award, during a visit to the Intel Ocotillo Campus, in Chandler, Arizona, U.S., March 20, 2024. 

Kevin Lamarque | Reuters

The Biden administration announced on Thursday it would forgive $5.8 billion in student debt for 77,700 borrowers through the Public Service Loan Forgiveness program.

It also said President Joe Biden would email another 380,000 public service workers starting next week, notifying them that they’re on track to have their debt canceled within two years.

The U.S. Department of Education has routinely announced waves of loan forgiveness, as the Biden administration seeks to use its existing authority to leave people with less debt after the Supreme Court struck down its sweeping $400 billion loan forgiveness plan last June. The Biden administration has so far cleared the education debts of nearly 4 million people, totaling $143.6 billion in relief.

“For too long, our nation’s teachers, nurses, social workers, firefighters, and other public servants faced logistical troubles and trap doors when they tried to access the debt relief they were entitled to under the law,” U.S. Secretary of Education Miguel Cardona said in a statement about the latest round of forgiveness.

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The PSLF program, signed into law by President George W. Bush in 2007, allows certain not-for-profit and government employees to have their federal student loans canceled after 10 years of on-time payments. In 2013, the Consumer Financial Protection Bureau estimated that one-quarter of American workers may be eligible.

However, the program had long been plagued by problems, making people who actually received the relief a rarity. Borrowers complained about confusing rules and misinformation from their servicers.

The Biden administration has worked to fix those issues.

Prior to Biden’s overhaul of PSLF, just around 7,000 borrowers had received debt relief under the program, according to the administration. Since 2021, it said, 871,000 borrowers have now had their debt canceled.

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