2023-07-14 23:45:01
Bloomberg — The US Department of Education will forgive $39 billion in student debt by updating a technical requirement under a long-standing program.
The change, announced on Friday, July 14, will help more than 804,000 borrowers. It comes as the Biden administration is seeking alternatives to a $400 billion student loan forgiveness plan that the Supreme Court struck down in June.
President Joe Biden called the latest move part of his administration’s commitment to “bring the promise of college to all Americans.”
The new plan counts more payments toward a forgiveness program that kicks in when distressed borrowers have made payments equal to 20 or 25 years.
“For too long, borrowers fell through the cracks of a broken system that failed to keep an accurate record of their progress toward forgiveness,” Education Secretary Miguel Cardona said in a statement.
The income-based plans allow struggling borrowers to make smaller payments and are different from Biden’s broader attempts to alleviate student debt, which well exceeds $1 trillion.
While the president has been thwarted by the Supreme Court, the administration has unloaded $72 billion in targeted loans, for students whose for-profit schools closed or qualified public servants.
In a statement Friday, Biden touted those efforts and criticized Republican lawmakers who oppose debt relief.
“We will not stop there,” Vice President Kamala Harris said in a statement. “Our administration will continue to fight to make sure Americans can access a high-quality higher education without being burdened with unmanageable student loan debt.”
The Education Department began notifying eligible borrowers Friday and said it would continue to identify those who meet the eligibility threshold every month through next year. Downloads begin within 30 days of email notifications being sent.
After the Supreme Court decision, Biden said he would try another massive debt forgiveness plan using a different legal logic than the one rejected by the court’s conservative majority.
Rep. Virginia Foxx, a North Carolina Republican who chairs the Education and Workforce Committee and opposes the pardon, called the change announced Friday “illegal” and “disgraceful.”
Read more at Bloomberg.com
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