Biden is forgiving $7.7 billion in student debt. Here's who qualifies.

biden is forgiving $7.7 billion in student debt. here's who qualifies.

cbsn-fusion-biden-says-heart-is-broken-over-gaza-morehouse-thumbnail.jpg

The White House on Wednesday said it has approved $7.7 billion of student debt cancellation for 160,500 borrowers, part of its ongoing effort to provide relief after the Supreme Court last year blocked President Joe Biden's plan for broad-based college loan forgiveness.

With the latest round of forgiveness, the administration has erased a total of $167 billion in student loans for 4.75 million people, or about 1 in 10 student loan borrowers, the Department of Education said.

The people who qualify for forgiveness in the latest round of debt cancellation include public servants such as teachers and law enforcement officers, as well as tens of thousands of people who have signed up for Biden's new loan repayment program, called SAVE. That program, created last year, pegs a borrower's monthly payment to their income, lowering their financial payments, and is designed to fix a pitfall of earlier repayment programs that allowed interest to snowball.

"One out of every 10 federal student loan borrowers approved for debt relief means one out of every 10 borrowers now has financial breathing room and a burden lifted," U.S. Secretary of Education Miguel Cardona said in the statement.

Here's what to know about the latest round of forgiveness.

Who qualifies for loan forgiveness?

The Biden administration said there are three groups of borrowers who have been approved for forgiveness in the latest round.

  • 66,900 borrowers will have $5.2 billion forgiven through the Public Service Loan Forgiveness program, which is designed to help public servants such as teachers, nurses and law enforcement officers get their debt canceled after 10 years of repayments. 
  • 54,300 borrowers will have $613 million forgiven through the SAVE plan. 
  • Another 39,200 borrowers will have $1.9 billion forgiven through adjustments to their income-driven repayment plans. These plans were sometimes mismanaged by loan servicers, which made it more difficult for some borrowers to achieve forgiveness. 

How will I know if I qualify for forgiveness?

The Biden administration said that people who qualify under this latest round of debt cancellation will get an email about their approval.

The debt cancellation will then be processed in the next few weeks, it added.

Does Biden plan to offer more student loan forgiveness? 

Yes, because the Biden administration is working on a new effort to provide broad-based loan forgiveness through the Higher Education Act.

The new plan could provide relief to about 30 million borrowers, either erasing some or all of their college loans.

The Biden administration on Wednesday said the public comment period on the new regulation closed on May 17, with the Department of Education now reviewing the thousands of comments it received.

"Our goal is to publish a final rule that results in delivering relief this fall," the Education Department said in the Wednesday statement.

How can borrowers sign up for SAVE? 

The SAVE plan is open for enrollment here.

The income-drive repayment plan bases monthly payments on income and family size, with some lower-income households with more family members paying little to nothing each month. For instance, a family of four with less than $50,000 in annual income would have monthly payments of $0.

Another benefit to the program is that it eliminates snowballing interest. In previous plans, borrowers sometimes saw their balances grow if their monthly payments didn't cover all their interest, a financial situation called "negative amortization." That's why some borrowers may have left college with, say, $20,000 in debt but ended up with much larger balances even after years of repayment.

OTHER NEWS

35 minutes ago

"Since that day nobody pushed Patrick Ewing around" - Knicks legend sent a message by punching Bill Laimbeer during Olympic tryouts

37 minutes ago

Search for missing boater near Oak Street Beach shifts to recovery

39 minutes ago

Horror as high flying fire lieutenant, 46, shoots dead his financial advisor wife, 34, and himself in grisly murder-suicide

39 minutes ago

Bikini-clad Olivia Dunne is joined by Xandra Pohl for lavish Hamptons getaway... just days after Miami DJ sparked romance rumors with NFL star

40 minutes ago

Homes in at least 16 counties affected by defective concrete as concerns raised over EU safety standard

40 minutes ago

Rory McIIroy must hunt down dominant Bryson DeChambeau in US Open to end major drought

40 minutes ago

Commanders Lose Kicker Target To Lions

40 minutes ago

Biden creates path for hundreds of thousands of undocumented migrants to gain legal status

40 minutes ago

A bank doled out $19 million to two executives just to keep them from walking away—but there are strings attached

40 minutes ago

Vikram Rathour quashes 'disciplinary issues' rumours, reveals reason for Shubman Gill, Avesh Khan's release from T20 WC

40 minutes ago

NBA Finals 2024: Takeaways from a stunning Mavericks blowout

40 minutes ago

Sunak was 'briefed' after Russian submarine detected near UK coast

40 minutes ago

British tennis ace Tim Henman backs £200 million Wimbledon expansion

40 minutes ago

How this tiny town was saved by America's newest state park

40 minutes ago

Missouri abortion ban wasn't about lawmakers imposing religious beliefs, judge says

40 minutes ago

Copa América: Ronaldinho's Brazil criticism part of ad campaign

40 minutes ago

Suns' King cleared of serious knee injury after scare

40 minutes ago

Katie Ledecky qualified for the 2024 Paris Olympics with a predictably dominant 400 freestyle win at U.S. trials

40 minutes ago

Why Kanopy Should Be Your New Favorite Streaming Service

46 minutes ago

AFL legend Brendan Fevola returns to the field - and you'll never guess how many goals he scored

46 minutes ago

Video: England are ready to ROAR: Gareth Southgate tells Three Lions stars to seize the day - as captain Harry Kane targets Golden Boot

46 minutes ago

The US town being sued for racism by its white people... because it's paying its black residents $25,000 each for the legacy of slavery

46 minutes ago

Popular tourist hotspot goes to war with Airbnb guests over booming music, fireworks at 1am and wild hot tub parties

47 minutes ago

Scottie Scheffler considering notable change to help majors performance

48 minutes ago

Jeff Bezos's Wild Dream of a Trillion People Living Throughout the Solar System on Gigantic Space Stations

48 minutes ago

Raphinha hits back at Mbappe in Euro 2024 vs World Cup debate

48 minutes ago

US waiting for Israel to conclude Rafah op. to continue hostage negotiations

48 minutes ago

World leaders to gather in Swiss resort in attempt to forge Ukraine peace plan

48 minutes ago

Maika Monroe Teases ‘It Follows’ Sequel Script Is “Bigger And Darker And More F***ed Up”

48 minutes ago

In photos: 2024 Queen City Pride Parade larger than ever

48 minutes ago

Gretchen Walsh sets a world record and Katie Ledecky secures her 4th trip to Olympics at U.S. trials

48 minutes ago

Temperatures expected to soar in the South over sizzling Father's Day weekend

48 minutes ago

0616 Today in History

48 minutes ago

Jordynne Grace’s open challenge in TNA was answered by the obvious choice from NXT

48 minutes ago

Hertz is giving drivers thousands off slightly used electric vehicles — here's how to get your hands on one

48 minutes ago

Man sparks discontent after sharing disheartening before-and-after images of tortoise habitat destruction: 'This is heartbreaking'

48 minutes ago

Silva vs. Sonnen Results: Live updates of the main event and undercard

48 minutes ago

Rory McIlroy sends warning to Bryson DeChambeau ahead of final day US Open battle

48 minutes ago

Penny Wong warns dropping 2030 climate targets would increase energy bills and abandon Pacific nations

48 minutes ago

Nuclear a ‘long term’ and ‘reliable solution’ to Australia’s energy needs