The Biden-Harris Administration has declared that it will automatically forgive $1.2 billion in loans for nearly 153,000 eligible borrowers under President Biden’s Saving on a Valuable Education (SAVE) Plan. This move comes as part of the Administration’s efforts to expedite relief to borrowers, with 7.5 million borrowers now enrolled in SAVE, including 4.3 million with a $0 monthly payment.
U.S. Secretary of Education Miguel Cardona stated that this action acknowledges the contribution of borrowers who have diligently paid off their loans over a decade and deserve relief. Under President Biden’s leadership, the Administration has approved loan forgiveness for almost 3.9 million borrowers, but the efforts to cancel student debt continue.
To be eligible for this forgiveness, borrowers must be enrolled in the SAVE Plan, have made at least 10 years of payments, and have initially borrowed $12,000 or less for college. Borrowers can receive forgiveness for each $1,000 borrowed above $12,000 after an additional year of payments. The forgiveness is based on the original principal balance of all Federal loans borrowed for education.
U.S. Under Secretary of Education James Kvaal emphasized the Administration’s commitment to fixing the broken student loan system and delivering the forgiveness borrowers have been waiting for. Borrowers approved for forgiveness will receive emails from President Biden, and no further action will be required from their end. The Department of Education will continue to identify and discharge eligible loans regularly.
The Biden-Harris Administration has a track record of providing relief, including through programs like Public Service Loan Forgiveness and improvements to income-driven repayment plans. Efforts are underway to make more borrowers eligible for loan forgiveness and strengthen institutional quality and program integrity.
The SAVE Plan, with 7.5 million enrollees, is the most affordable repayment option for low- and middle-income borrowers, offering protection from high interest and balances larger than the original loan. The plan’s benefits will be fully implemented in July 2024, further reducing monthly payments.
Borrowers seeking forgiveness or the right repayment plan can find more information on StudentAid.gov.
More information available on https://studentaid.gov/manage-loans/forgiveness-cancellation and https://studentaid.gov/manage-loans/repayment/prepare-payments-restart