President Joe Biden announced on Wednesday the cancellation of $7.7 billion in student debt for 160,000 borrowers.
This relief targets three groups: nearly 67,000 borrowers eligible through the Public Service Loan Forgiveness program, around 54,000 enrolled in a new income-driven repayment plan, and 39,200 in earlier income-driven plans. The administration has been rolling out forgiveness as more people qualify. “From day one of my administration, I promised to ensure higher education is a ticket to the middle class, not a barrier,” Biden said. “I will never stop working to cancel student debt—no matter how many times Republican-elected officials try to stop us.” With this action, the administration has canceled $167 billion in student debt for 4.75 million Americans.
Education Secretary Miguel Cardona highlighted that one in 10 federal student loan borrowers have received debt relief. “The Biden-Harris Administration is committed to bringing student debt relief to millions more, and this announcement proves it,” Cardona said. “One out of every 10 borrowers now has financial breathing room and a burden lifted.”
The cancellation continues despite Biden’s SAVE plan facing legal challenges from 18 states arguing that Congress must approve any overhaul of federal repayment plans.
Last month, Biden proposed a new mass cancellation plan after the Supreme Court rejected his first attempt. That plan aimed to erase up to $20,000 in federal student loans for individuals earning less than $125,000 or couples earning less than $250,000, costing an estimated $400 billion and benefiting over 40 million people. The Supreme Court ruled that Biden had overstepped his authority. The new plan, with a different legal basis, targets five borrower categories in greatest need, aiming to provide relief to 30 million borrowers. However, Republicans criticize its estimated $127 billion cost.
