SOFI - Biden administration to forgive another $5B in student debt

2024-01-19 05:55:45 ET

The Biden administration said it will forgive another nearly $5B in student debt for 74K borrowers, bringing the total number of people whose debt was cancelled through various actions to over 3.7M.

The relief follows the Department of Education's fixes to income-driven repayment plans and the Public Service Loan Forgiveness program. The announcement did not disclose when eligible borrowers can expect to see that relief.

"Of the 74K borrowers, nearly 44K of them are teachers, nurses, firefighters and other individuals who earned forgiveness after 10 years of public service, and close to 30K of them are people who have been in repayment for at least 20 years but never got the relief they earned through income-driven repayment plans," President Joe Biden said in a statement .

These repayment plans were designed to ensure debt forgiveness after a fixed period, but experts say that has not been the case for many as loan servicers have largely failed to keep track of repayments.

The Biden administration has so far forgiven more than $136B in student debt. Recall that last year, the Supreme Court struck down Biden's student loan forgiveness plan to cancel up to $20K of student loans per borrower.

His administration then turned to the Higher Education Act to implement debt relief.

More on student debt

• Biden administration cancels $9B more of student debt
• Student loan payments resume. What does it mean for the economy?
• SoFi: The Good, Bad And Ugly
• The Student Debt Drag

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