Current:Home > StocksBiden administration is forgiving $1.2 billion in student debt for 153,000 borrowers. Here's who qualifies.-LoTradeCoin
Biden administration is forgiving $1.2 billion in student debt for 153,000 borrowers. Here's who qualifies.
View Date:2024-12-23 19:01:26
The Biden administration on Wednesday said it is automatically forgiving $1.2 billion in student debt for 153,000 borrowers. Loan holders whose debt will be discharged will receive an email from President Joe Biden today informing them of the forgiveness, the Department of Education said.
The debt relief is the latest push from the White House to address the nation's $1.77 trillion in student debt after the Supreme Court last year invalidated the Biden administration's plan for broad-based student loan forgiveness. That plan would have helped more than 40 million borrowers each wipe away up to $20,000 in debt.
With this latest round, the Biden administration said it has approved loan relief for nearly 3.9 million borrowers, many of whom have been repaying their debt for decades. The 153,000 borrowers who qualify for the latest debt forgiveness are those who are enrolled in the Saving on a Valuable Education (SAVE) repayment plan and who have made at least 10 years of payments.
"[I]f you've been paying for a decade, you've done your part, and you deserve relief," said U.S. Secretary of Education Miguel Cardona in the statement.
Who qualifies for this new debt forgiveness?
The Biden administration said 153,000 borrowers who are enrolled in the SAVE plan are eligible.
Those who are eligible have been enrolled in repayment plans for at least 10 years and originally borrowed $12,000 or less for college, the Education Department said.
For every $1,000 borrowed above $12,000, a borrower can receive forgiveness after an additional year of payments, the department added.
What steps do borrowers have to take?
None, according to the Education Department.
People receiving a loan discharge will get an email from Biden today about their loan forgiveness, and don't need to take further action. Servicers will process the forgiveness in the next few days, and borrowers will see their loans forgiven in their accounts, according to the statement.
What is the SAVE plan?
The SAVE plan is income-driven repayment program, or IDR, that was created by the Biden administration. IDRs peg a borrower's monthly payment to their income, lowering their financial burden.
The SAVE plan was designed to fix some problems with older IDR programs, such as allowing interest to snowball on a borrower's debt.
All borrowers enrolled in SAVE can receive forgiveness after 20 years or 25 years of repayments, but the White House has developed the shorter 10-year forgiveness period for people with smaller balances.
Borrowers can apply for the SAVE plan here.
How many people are enrolled in SAVE?
There are currently 7.5 million borrowers enrolled in SAVE, the Education Department said on Wednesday. About 4.3 million of those have a $0 monthly payment.
- In:
- Joe Biden
- Student Debt
Aimee Picchi is the associate managing editor for CBS MoneyWatch, where she covers business and personal finance. She previously worked at Bloomberg News and has written for national news outlets including USA Today and Consumer Reports.
TwitterveryGood! (24295)
Related
- Rita Ora pays tribute to Liam Payne at MTV Europe Music Awards: 'He brought so much joy'
- Dispute over seats in Albuquerque movie theater leads to deadly shooting, fleeing filmgoers
- 5 teens, including 4 Texas Roadhouse employees, found dead after car lands in Florida retention pond
- Indonesia Deporting 2 More Climate Activists, 2 Reporters
- Biden funded new factories and infrastructure projects, but Trump might get to cut the ribbons
- Ever wanted to stay in the Barbie DreamHouse? Now you can, but there's a catch
- South Miami Approves Solar Roof Rules, Inspired by a Teenager
- Rachel Hollis Reflects on Unbelievably Intense 4 Months After Ex-Husband Dave Hollis' Death
- How Alex Jones’ Infowars wound up in the hands of The Onion
- Armie Hammer Not Charged With Sexual Assault After LAPD Investigation
Ranking
- NATO’s Rutte calls for more Western support for Ukraine, warns of Russian alliances
- BMW Tests Electric Cars as Power Grid Stabilizers
- The Western Consumption Problem: We Can’t Just Blame China
- Vanderpump Rules Tease: Tom Sandoval Must Pick a Side in Raquel Leviss & Scheana Shay's Feud
- Isiah Pacheco injury updates: When will Chiefs RB return?
- Jesse Tyler Ferguson’s Father’s Day Gift Ideas Are Perfect for the Modern Family
- 16 Game-Winning Ted Lasso Gift Ideas That Will Add Positivity to Your Life
- Supercritical CO2: The Most Important Climate Solution You’ve Never Heard Of
Recommendation
-
Lady Gaga Joins Wednesday Season 2 With Jenna Ortega, So Prepare to Have a Monster Ball
-
Gender-affirming care for trans youth: Separating medical facts from misinformation
-
Convicted double murderer Joseph Zieler elbows his attorney in face — then is sentenced to death in Florida
-
Trump Demoted FERC Chairman Chatterjee After He Expressed Support for Carbon Pricing
-
FBI raids New York City apartment of Polymarket CEO Shayne Coplan, reports say
-
Is 100% Renewable Energy Feasible? New Paper Argues for a Different Target
-
World’s Youth Demand Fair, Effective Climate Action
-
Climate Science Has a Blind Spot When it Comes to Heat Waves in Southern Africa