![]() ![]() The Department of Education said it will continue to identify and discharge loans on a regular basis and will email borrowers starting next week who can become eligible for this forgiveness if they switch to the SAVE program. The administration said 7.5 million borrowers are now enrolled in SAVE. In the coming days, the administration said, loan servicers will process the forgiveness and borrowers who qualify will see their loans forgiven on their accounts. Those who qualify will have their debts canceled immediately, the administration said, and won't have to take any action to get loans canceled. If I qualify, when will my student loan debt be canceled? The Department of Education had originally set a July deadline to roll out its student debt relief plan. Forgiveness will be based on the amount originally borrowed and not on the amount currently owed. Those with larger loans can qualify over a longer time period: For every additional $1,000 borrowed above $12,000, borrowers must make an additional year of payments before their loans are canceled. The Department of Education is now forgiving loans for borrowers who are enrolled in the department's SAVE plan, who originally took out $12,000 or less for undergraduate or postgraduate studies and have been paying off the loan for at least 10 years, according to a press release. What is the Department of Education's new plan to cancel student loan debt? And here are our picks for the best tax software for 2024. For more on your money, here are your tax filing deadlines this year and how you can track the status of your tax refund. Here's what we know about the new plan to cancel federal student loan debt and who qualifies. Total student loan debt at the end of 2023 stood at $1.6 trillion, according to the Federal Reserve Bank of New York, second in household debt behind home mortgages at $12.14 trillion. The administration's plan to forgive up to $20,000 in federal student loans for all borrowers was knocked down by a Supreme Court ruling last summer. The Department of Education paused student loan repayments and interest through the pandemic and restarted payments in fall 2023. Under the SAVE plan, you are eligible for forgiveness if you borrowed less than $12,000 in federal student loans and have been in repayment for at least 10 years. SAVE is the newest of four income-driven repayment plans available to federal student loan borrowers. The debt forgiveness comes almost four years after then-presidential candidate Joe Biden proposed a plan for broad student loan forgiveness. ![]() Starting Wednesday, the administration is notifying borrowers enrolled in the Saving on a Valuable Education plan that it's canceling $1.2 billion in student debt. In announcing this repayment plan, Cardona called this the "first true student loans safety net in the country" and also boasted that the Biden administration has "forgiven more debt than any other administration in history."Īltogether, the Education Department said the Biden administration has canceled more than $116 billion in student loans for 3.4 million Americans, including public service workers, disabled Americans, and borrowers who repaid their loans for 20 years but never received the loan forgiveness they were promised.Nearly 153,000 student loan borrowers are getting debt relief today, the Biden administration has announced. The spokesperson told CBS News that Education Department officials are "confident in our legal authority" to implement this new repayment plan because "Congress gave the Department of Education the authority to define the terms of income-driven repayment plans." This new repayment plan comes after President Biden's plan to cancel $10,000 of student loans for millions of Americans was blocked by the Supreme Court in June, when it rejected the administration's argument that Education Secretary Miguel Cardona had the power to forgive student loan debt. ![]() "For each additional $1,000 borrowed above that level, the plan adds an additional for up to a maximum of 20 or 25 years," the department said. Borrowers with balances of $12,000 or less will see the rest of their loans forgiven after 10 years when the borrower has made 120 payments. However, the officials said loans taken out by parents on behalf of students - referred to as PLUS loans -are "generally not eligible for this plan."Įarly forgiveness is another new facet of this plan, too. ![]()
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