Joe Biden supported federal student loan forgiveness of up to $10,000 per borrower while running for office. Biden’s presidency is just over one year old and has not made any significant student debt cancellations.
However, the administration has canceled more than $17 billion of debt for approximately 725,000 borrowers for multiple reasons.
It is a list of students who are eligible for student loan forgiveness due to recent Education Department moves 40,000. It is due to changes in ‘longstanding failings’
Recently, the Biden administration announced that new actions were taken by the Department of Education to “fix longstanding failings in the student loans programs.” An estimated 40,000 borrowers now have the option of “immediate debt cancellation” because they are now eligible under the Public Service Loan Forgiveness Program.
The Department of Education reports that income-driven repayment will allow thousands of older borrowers to be forgiven. Another 3.6 Million will receive credit for income-driven repayment forgiveness (IDR) for at least three more years.
The announcement by the Department of Education on these changes does not include the total amount of forgiven debt. Still, a Wednesday statement by Jason Smith, House Budget Committee Republican Leader, states that it will result in $3 billion in debt cancellation for the remaining 40,000 borrowers.
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Additional PSLF relief
According to the Education Department. Under the Biden administration, more than 113,000 borrowers received $6.8B in debt cancellation.
Last Oct, the overhaul of PSLF was expected to allow 22,000 borrowers who have consolidated loans to receive $1.74 Billion in forgiveness immediately without additional actions. In the meantime, the Education Department announced that another 27,000 borrowers could receive $2.82 Billion in forgiveness if their employment can be “certified further.”
By 2021, more than 70,000 borrowers were eligible for federal student loan forgiveness.
Borrowers who have a total or permanent disability
Another 400,000 borrowers suffering from total or permanent disability have had their student loan debt forgiven by $7.8 billion.
A new regulation by the Education Department granted more than $5.8 Billion in automatic student loan discharges to 323,000 borrowers in August. Officials used the Social Security Administration’s existing data to identify eligible borrowers.
Federal Student Aid COO Richard Cordray estimated that 15,000 to 20,000 new eligible borrowers would have loans discharged each quarter using this data matching.
Their school defrauders’ borrowers
About 107,000 borrowers who were defrauded in the past by their schools have received $2 billion in student debt cancellation. One of those is DeVry University’s former students, who received relief when the Education Department found that the institution had “made widespread substantial misrepresentations concerning its job placement rates.”
25900 more borrowers are now receiving borrower defense discharges as a result of findings from five other institutions
- Westwood College
- ITT Technical Institute’s Nursing Program
- Minnesota School of Business/Globe University has criminal justice programs
- Corinthian Colleges
- Marinello Schools of Beauty
According to Education Department Secretary Miguel Cardona, these colleges “violated law and standards.”
$1.2 Billion was granted to all who attended ITT Technical Institutes before it closed.
WHAT ABOUT widespread STUDENT LOAN FORGIVENESS?
Before Biden announced the fourth freeze on a student loan, 96 lawmakers, 21 Senators, and 75% of the House called on him. He stated that the “cancellation” would have long-term economic benefits, such as helping families buy their first homes, start a business, or plan for retirement. Cancellation of student loan debt would result in tens or hundreds of billions of dollars of GDP growth.
There is some confusion over Biden’s authority to cancel student loan loans. Nancy Pelosi, the House Speaker, has stated he doesn’t have the legal authority and instead commented, “That would constitute an act of Congress.” Chuck Schumer (Senate Majority Leader) has claimed that Biden could do it using the same legal provision Trump used in delaying interest accrual and payments at the beginning of the pandemic.