US President Joe Biden will announce a new student loan forgiveness plan for millions of borrowers next week.
This is President Biden's second effort to achieve significant loan forgiveness after the Supreme Court rejected his plan to cancel $400 billion in student loan debt last year.
Biden Administration Approves New Student Loan Forgiveness Plan
Despite setbacks, Biden's administration has proactively provided significant debt relief to students.
As per the most recent data from the Education Department, the Biden administration has already authorized over $143 billion in student loan forgiveness since 2021, as reported by Forbes.
According to the outlet, the ongoing relief efforts have been multifaceted, utilizing existing programs and regulatory reforms rather than relying solely on new initiatives.
For instance, the administration has facilitated $45.6 billion in loan forgiveness for more than 900,000 borrowers through income-driven repayment adjustments.
Additionally, fixes to the Public Service Loan Forgiveness program have resulted in $62.5 billion in forgiveness for over 870,000 borrowers.
The Education Department's actions have also extended relief to borrowers affected by school closures, fraud, or misrepresentations, totaling over $22.5 billion.
Furthermore, nearly half a million borrowers with disabling medical conditions have seen nearly $12 billion in debt discharges.
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Targeted Student Loan Relief Plan Under Higher Education Act
Amid the accomplishments, the administration is preparing to introduce a new student loan forgiveness plan under the Higher Education Act.
This plan aims to provide targeted relief to specific borrower groups facing challenges such as negative amortization, extended repayment periods, and financial hardship.
The development of this new plan has progressed through the negotiated rulemaking process, focusing on hardship-based forgiveness. While the plan's specific details are forthcoming, it is expected to address critical issues millions of borrowers face.
President Biden will unveil the plan on Monday in Madison, Wisconsin, home to the University of Wisconsin's main campus.
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