Biden Administration Announces Automatic Discharge of $12 Billion in Student Loans
167 Billion in Loan Forgiveness Approved
In a move that will provide significant relief to millions of borrowers, the Biden-Harris Administration today announced that it will automatically discharge $12 billion in student loans for 138,000 borrowers. This brings the total amount of loan forgiveness approved by the administration to $167 billion.
Time-Limited Changes to Public Service Loan Forgiveness (PSLF)
In addition to the automatic discharges, the Department of Education has announced time-limited changes to PSLF that will make it easier for borrowers to qualify for forgiveness. These changes include:
- Counting all payments, regardless of when they were made or the repayment plan being used, towards loan forgiveness
- Eliminating the requirement for borrowers to submit a PSLF form annually
- Providing a new, temporary waiver that allows borrowers to consolidate old loans into a Direct Consolidation Loan and still receive credit for previous payments made on those loans
SAVE Plan Builds on Broader Relief Efforts
The SAVE plan (Student Aid Verification and Enforcement Act) builds on broader actions by the Biden-Harris Administration to deliver relief to student loan borrowers. These actions include:
- Extending the student loan payment pause through August 31, 2023
- Forgiving $5.8 billion in student loans for 323,000 borrowers with disabilities
- Canceling up to $20,000 in student loan debt for borrowers who received Pell Grants and up to $10,000 for other borrowers
Automatic Discharges to Begin Shortly
The US Department of Education announced that automatic discharges will begin for 138,000 borrowers in the coming weeks. Borrowers do not need to take any action to receive this relief.
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