New Wave of Federal Student Loan Forgiveness Announced
In a significant move, the Biden administration has unveiled a fresh round of federal student loan forgiveness, benefiting over 150,000 individuals to the tune of approximately $4.2 billion. This development comes just days before President Joe Biden’s term ends, bringing much-needed relief to those struggling with student debt.
Borrower Defense Loan Discharge Program: A Lifeline for Many
Nearly 85,000 individuals will have their federal student debt forgiven through the U.S. Department of Education’s Borrower Defense Loan Discharge program. This program offers a way out for students who were misled by their schools, didn’t receive a quality education, or had their institution close while they were enrolled.
Group Discharges for Thousands of Students
The Education Department has approved group discharges for 73,600 students who attended schools owned by the Center for Excellence in Higher Education, including Independence University and California College San Diego. These borrowers will receive $1.15 billion in debt forgiveness, covering the period between January 1, 2006, and August 1, 2021.
Another 11,000 borrowers who attended Drake College of Business between January 1, 2008, and July 31, 2015, will have their student debt canceled, totaling $107 million. Additionally, 280 borrowers who enrolled in the Criminal Justice Program at Lincoln Technical Institute’s campus in Lowell, Massachusetts, between 2010 and 2012, or the Somerville, Massachusetts, campus from 2010 to 2013, will have their federal student debt cleared, receiving a total of $1.4 million in loan forgiveness.
Automatic Relief for Eligible Borrowers
Eligible borrowers who attended these institutions will receive the aid automatically, without needing to apply. They can expect to receive emails in the coming days, informing them of the debt forgiveness.
Total and Permanent Disability Discharge: A Helping Hand
An additional 61,000 federal student loan borrowers with a “total and permanent” disability will receive $2.5 billion in debt erasure. This relief includes borrowers automatically approved for debt forgiveness through data matches with the U.S. Social Security Administration and the Department of Veteran Affairs, as well as those who applied for the loan discharge.
Public Service Loan Forgiveness: A Beacon of Hope
The Education Department has also granted loan forgiveness to 6,100 borrowers under the Public Service Loan Forgiveness (PSLF) program, totaling $465 million. This program allows employees of the government and certain not-for-profit entities to have federal student loans discharged after 10 years of on-time payments.
A New Era of Student Loan Forgiveness
The Biden administration’s efforts to expand eligibility and allow people to reapply for relief have been instrumental in reversing the trend of borrowers being excluded from PSLF on technicalities. With the PSLF help tool, borrowers can search for a list of qualifying employers under the program and access the employer certification form.
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