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Biden Administration Announces $1.2 Billion Student Debt Cancellation for 150,000 Borrowers

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Biden Administration Announces $1.2 Billion Student Debt Cancellation for 150,000 Borrowers

(CTN News) – The Biden administration has cancelled an additional $1.2 billion in student debt for over 150,000 debtors.

The newest loan forgiveness, announced by the Education Department on Wednesday, is aimed at a specific set of long-term borrowers enrolled in the department’s much-touted repayment scheme, which lowers monthly payments based on people’s salaries.

Total Student Debt Cancellation Under Biden Reaches $138 Billion

This raises Biden’s overall debt cancellation approvals to $138 billion for roughly 4 million Americans. The announcement comes only one day before a panel of government negotiators is scheduled to debate broader ideas for additional student loan relief.

According to the agency, borrowers who qualify for forgiveness will begin to see their debts cancelled in the coming days. The White House began delivering email reminders to those borrowers on Wednesday.

According to the Education Department, loan lenders will process the relief without requiring qualifying borrowers to take additional action.

It’s the first round of forgiveness since the Education Department accelerated the implementation of President Joe Biden’s income-based repayment plan, known as SAVE. Initially, the relief was scheduled to be approved later this summer. At the time, the agency could not say how many debtors would face automatic cancellation.

Tens of thousands of qualified borrowers must meet a precise set of criteria. To be eligible, people have to be enrolled in SAVE. They had to be in repayment for at least ten years on a debt of $12,000 or less.

“From day one of my Administration, I vowed to fix student loan programmes so higher education can be a ticket to the middle class – not a barrier to opportunity.” Biden wrote in an email intended for qualifying borrowers. “I hope this relief gives you a little more breathing room.”

The president has previously directly appealed to the millions of debtors whose student debt the government is responsible for cancelling. Biden delivered a similar message to almost a million borrowers last autumn.

The White House’s steady drumbeat of debt forgiveness news is part of Biden’s electoral plan as he pursues reelection in November. Despite House Republicans’ complaints and new judicial challenges, Biden’s staff is pushing ahead.

Research indicates that Democrats and younger voters favour leaders who deliver on pledges of student loan reduction.

According to Biden’s SAVE plan, 4.3 million borrowers out of 7.5 million now have $0 monthly payments.

According to the agency, once the department checks the accounts on its files, any borrowers who fit the eligibility criteria – having been paying off loans of $12,000 or less for at least ten years – will shortly have their loan debt automatically cancelled.

The government announced Wednesday that it will continue to identify and cancel loans for borrowers who fit the requirement “on a regular basis.”

Borrowers not currently registered in SAVE will not be eligible for the forgiveness. However, the administration announced next week that it will begin emailing borrowers who may be eligible if they sign up for the programme.

Arsi Mughal is a staff writer at CTN News, delivering insightful and engaging content on a wide range of topics. With a knack for clear and concise writing, he crafts articles that resonate with readers. Arsi's pieces are well-researched, informative, and presented in a straightforward manner, making complex subjects accessible to a broad audience. His writing style strikes the perfect balance between professionalism and casual approachability, ensuring an enjoyable reading experience.

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