WASHINGTON — The Biden administration on Wednesday will cancel $1.2 billion in student loans for about 153,000 borrowers who took out relatively small student loans and have repaid them over the past decade.
Borrowers must be enrolled in the government's Savings for a Valuable Education (SAVE) repayment plan, have been repaying for at least 10 years, and have spent $12,000 or less in initial college funding. are eligible for exemption. A White House fact sheet states: It also said, “For every $1,000 borrowed over $12,000, the borrower will be eligible for forgiveness after an additional year of repayment.”
For example, the fact sheet states: “Borrowers enrolled in SAVE who took out federal loans of $14,000 or less to earn an associate's degree in biotechnology will have their debts fully forgiven starting this week if they have made the payments for 12 years. “You can receive it,” it says.
Those who received relief will receive an email from President Joe Biden with the message, “We hope this relief gives you a little more breathing room.”
“I can't count the stories of how easing the burden of student loan debt allows them to support themselves and their families, buy their first home, start a small business, and move forward with their life plans. We have heard from you. Please hold,” the email reads.
The White House announced Wednesday that relief provided under the plan, which began last summer, was originally scheduled for July, but the loans will be cut off about six months early.
Education Secretary Miguel Cardona told reporters Tuesday that the forgiveness would be automatic and the total student loans canceled by the Biden administration would be about $138 billion for about 3.9 million borrowers.
“These are historic efforts that reflect the President's commitment to providing as much relief as possible to as many borrowers as possible as quickly as possible,” he said. “The bottom line is that it provides real and immediate respite from the untenable reality that student loan payments compete with basic needs like putting food on the table and access to health care. I'm saying that.”
The Department of Education will directly contact other borrowers who are also eligible for early relief but are not enrolled in the SAVE plan next week, the White House said.
Biden said 7.5 million of the 30 million people eligible are currently enrolled in the plan. The debt relief program comes after the Supreme Court struck down Biden's original student debt relief program, which aimed to cancel up to $20,000 in debt for about 43 million borrowers. It was introduced last year.
