President Joe Biden’s administration has continued its efforts towards student loan forgiveness by cancelling another $300 million in debt through various programs, with a focus on the Public Service Loan Forgiveness (PSLF) program. This latest wave of loan forgiveness approvals is part of a broader initiative aimed at providing relief to borrowers who have been making payments on their student loans for at least a decade. Under Secretary of Education James Kvaal stated that these borrowers have paid what they can afford and have earned forgiveness for the remaining balance of their loans.
The PSLF program, which allows for federal student debt forgiveness for borrowers who work in public service, has seen numerous improvements under the Biden administration to address past issues and increase access to the program. These initiatives include temporary programs such as the Limited PSLF Waiver and the IDR Account Adjustment, as well as regulatory reforms and a new online platform for submitting employment certifications. As a result of these changes, the PSLF program has experienced significant growth, with approval rates increasing from one percent to approvals totaling $62.8 billion for almost 876,000 borrowers since 2021.
In addition to the PSLF approvals, the Education Department also approved at least $3 billion in forgiveness through the new SAVE plan, which can shorten borrowers’ forgiveness timelines to as little as 10 years with certain conditions. More than 200,000 borrowers received debt relief under this provision. The department also approved over 65,700 borrowers for debt relief under the IDR Account Adjustment, relaxing rules pertaining to student loan forgiveness under income-driven repayment plans. Borrowers working in qualifying public service employment may also have past periods count towards PSLF.
Furthermore, the Education Department announced that President Biden is planning to unveil a new mass debt cancellation program as a replacement for his previous plan that was rejected by the Supreme Court. This new program will target relief to five groups of borrowers, including those facing hardship. While the administration is working through the necessary administrative steps before officially launching the program, borrowers could potentially start applying for loan forgiveness as early as this fall. However, there is a possibility that the program could face legal challenges that may impact its implementation.
