For some of his final days in office, President Joe Biden’s administration has forgiven student loans for over 150,000 select individuals, bringing the total numbers of Americans with student debt relief under the Administration to over 5 million. This totals $183.6 billion, the most debt relief delivered by any administration in American history.
President Biden stated in his announcement, “My administration has taken historic action to reduce the burden of student debt, hold bad actors accountable, and fight on behalf of students across the country.”
Debt Relief Recipients
The recipients of this debt relief include:
- Students “cheated and defrauded by their schools” (85,000 individuals)
- Borrowers with “total and permanent” disabilities (61,000 individuals)
- Public servants (6,100 borrowers) supported through the Department of Education’s Public Service Loan Forgiveness (PSLF) program, including teachers, firefighters, and social workers
Public Service Loan Forgiveness
In 2024, the PSLF program created a new method of processing applications and approvals. Comparatively, at the beginning of the Biden-Harris administration, only 7000 borrowers had received PSLF relief. This number has since grown to nearly 1.1 million individuals.
New Repayment Options
As of Dec. 18, 2024, the Department also reopened two plans – the first is the Pay As You Earn Repayment (PAYE) plan, which limits monthly payments to 10% of a borrower’s discretionary income, divided by 12. Those who hope to determine if they are eligible can check here.
Additionally, the second repayment plan is the Income-Contingent Repayment (ICR) plan, which consists of monthly payments that “are the lesser of (1) what you would pay on a repayment plan with a fixed monthly payment over 12 years, adjusted based on your income or (2) 20% of your discretionary income, divided by 12.”
The Bigger Picture
The $183.6 billion in student debt relief is beyond a number – it represents the financial and emotional freedom that is granted to millions of Americans, marking significant progress at making education more accessible. As a result of the reopening of PAYE and ICR plans,, in addition to the expansion of the PSLF program, the Department is certainly setting a precedent for future academic policies.
Those wondering about their eligibility or seeking additional information can also take a look at the U.S. Department of Education’s website.
