The Biden administration on Friday announced that individuals with student loan debt may have their debt canceled.
More than 277,000 additional borrowers will have their student debt canceled, amounting to $7.4 million.
According to a news release from the White House on April 12, the cancellation applies to “borrowers enrolled in the SAVE Plan, other borrowers enrolled in Income-Driven Repayment plans, and borrowers receiving Public Service Loan Forgiveness.”
Income-driven repayments (IDR) plans “base your monthly payment amount on how much money you make and your family size,” per Federal Student Aid.
The SAVE Plan is an IDR plan that often lowers payments and has an additional interest benefit: “If you make your full monthly payment, but it is not enough to cover the accrued monthly interest, the government covers the rest of the interest that accrued that month. This means that the SAVE Plan prevents your balance from growing due to unpaid interest.”
Public Service Loan Forgiveness (PSLF) applies to those individuals “employed by a government or not-for-profit organization” who meet specific criteria.
Of the $7.4 billion in student loan debt relief, $3.6 billion will go towards 206,800 borrowers through SAVE, $3.5 billion will go towards 65,800 borrowers through adjustments to IDR, and $300 million will go towards 4,600 borrowers through PSLF, according to the U.S. Department of Education.
“This week’s announcements reinforce the President’s commitment to using every path available to deliver student debt relief to as many borrowers as possible through various actions,” the White House release reads.
Biden’s administration has now approved $153 billion total in student loan relief across nearly 4.3 million borrowers.
In March, the administration announced it was canceling student loan debt for 78,000 public service workers under the PSLF.
Last week, the White House revealed its plans to “fully eliminate accrued interest for 23 million borrowers,” “cancel the full amount of student debt for over 4 million borrowers, and provide more than 10 million borrowers with at least $5,000 in debt relief or more,” as previously reported by The Dallas Express.
Texas has 56,200 borrowers with an outstanding balance of $4 billion, compared to the U.S., which has 871,470 borrowers with an outstanding balance of $64.5 million.
The Biden administration has faced criticism surrounding student loan forgiveness as the U.S. debt continues to increase. FiscalData shows the current national debt at $34.55 trillion.
A total of 18 states across two lawsuits are now suing the Biden administration in an attempt to block Biden’s debt cancellation program, as reported by The Dallas Express.
The second federal lawsuit, filed on April 9 and led by Missouri, claims that the president is “unilaterally trying to impose an extraordinarily expensive and controversial policy that he could not get through Congress,” as DX previously covered.
The Committee on Education & the Workforce calls the Biden administration’s student loan policies a “scam,” claiming it is “reckless, costing taxpayers billions.” According to the committee, these policies are unfair to “taxpayers, including the 100 million Americans who never went to college,” “Americans already struggling to put food on the table due to Biden inflation,” and “future students who will bear the burden of ballooning college costs.”
In 2023, the Supreme Court ruled by a vote of 6-3 that Biden’s administration overstepped its authority when announcing the cancellation of up to $400 billion in student loans.
The justices of the majority opinion claimed that the cancellation plan didn’t comply with the HEROES Act and other federal laws.