UNITED STATES: The Education Department announced on Friday that the administration of US President Joe Biden will forgive $39 billion in student loan debt for more than 804,000 students. The department attributed the relief to a “fix” to income-driven repayment (IDR) plans.
According to the department, borrowers will be qualified for forgiveness if they have made 20 or 25 years’ worth of IDR payments. For debtors with lesser incomes, the IDR programme places a cap on their monthly payments and forgives any outstanding debt after a certain period of time.
These debtors will join the millions of individuals who have received relief from the US government over the previous two years, totaling over $116 billion in loan relief to over 3 million debtors under the administration, according to Biden.
The relief corrects what it called “historical inaccuracies” in the calculation of payments that are eligible for forgiveness under IDR programmes, according to the administration.
According to Miguel Cardona, secretary of education, for far too long, borrowers were let down by an unreliable system that failed to accurately monitor their path to forgiveness.
After the Supreme Court rejected Biden’s proposal to erase hundreds of billions of dollars in debt, the US President stated he would pursue new approaches to relieve Americans of their student loan debt.
In order to implement his $430 billion loan relief plan, the Education Department has begun a regulatory “rulemaking” procedure. It’s anticipated that the process will take months.
According to the department, Friday’s relief is covered by a payment count adjustment program announced by the Biden administration in April 2022.
The administration will keep fighting to ensure that Americans have access to affordable, high-quality postsecondary education, according to vice president Kamala Harris.
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