On Wednesday, the White House approved $7.7 billion in debt cancellation for more than 160,000 borrowers. This debt relief was tied to forgiveness programs, such as Public Service Loan Forgiveness, Saving on a Valuable Education and income-driven repayment plans.
This brings the Biden administration’s total student loan cancellation amounts to $167 billion across approximately 4.75 million borrowers.
“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,” said Miguel Cardona, the US Secretary of Education, a press release.
This news comes during a processing pause for borrowers enrolled in certain forgiveness programs like the PSLF. The Department of Education has paused the processing of PSLF and TEACH applications while borrower accounts are moved from loan servicer Mohela to the Department of Education’s loan servicing platform on StudentAid.gov. Payment counts are also being adjusted for all borrowers with qualifying federal loans, including those who recently consolidated their student loans.
If you have federal loans, you may be eligible for debt cancellation under the Biden administration’s latest debt relief plan, an income-driven repayment plan, or another program. The Department of Education is reassessing payment counts now through Sept. 1 to determine if you’re eligible for debt relief.
Not all federal loans are eligible for debt relief. If you hold a Perkins, Parent Plus, HEAL or commercially held FFEL loan, you now have until June 30 to consolidate your loans into a new Direct Loan with debt forgiveness benefits. Consolidating your loans may also help you receive forgiveness sooner if you have Direct Loans and have been paying for 20 to 25 years. You can learn more about loan consolidation and apply now at StudentAid.gov.
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