Biden Administration Announces $39 Billion In Student Loan Forgiveness

By Bill Galluccio

July 14, 2023

Loan Forgiveness
Photo: jayk7 / Moment / Getty Images

The Biden administration announced plans to cancel student loan debt for more than 800,000 borrowers. The plan will cost $39 billion. The new plan will forgive student loans for some borrowers enrolled in income-driven repayment plans. Those plans allow loans to be forgiven after making payments for 20 to 25 years.

The administration said that the Department of Education will now count payments for borrowers who have made partial or late payments over the years. In addition, some borrowers who were in certain deferments and forbearances will also have those payments counted.

“For far too long, borrowers fell through the cracks of a broken system that failed to keep accurate track of their progress towards forgiveness,” Education Secretary Miguel Cardona said in a statement.

“By fixing past administrative failures, we are ensuring everyone gets the forgiveness they deserve, just as we have done for public servants, students who were cheated by their colleges, and borrowers with permanent disabilities, including veterans,” Cardona added.

The Education Department will begin notifying borrowers whose loans have been forgiven in the coming days.

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