What groups are still in line for student loan forgiveness?
The Biden administration has been able to forgive billions of dollars in student loans despite the Supreme Court blocking President Biden’s plan to cancel up to $400 billion in student debt in June 2023.
WASHINGTON (NEXSTAR) – The Biden administration has been able to forgive billions of dollars in student loans despite the Supreme Court blocking President Joe Biden’s plan to cancel up to $400 billion in student debt in June 2023.
Specific categories of borrowers can still see relief through pre-existing student federal loan forgiveness programs. Here’s a list of who could qualify, according to the Department of Education:
- Teachers
- Government Employees
- Nonprofit workers
- Nurses, doctors or other medical professionals
- People with disabilities
- People who repay loans under an Income-Driven Repayment (IDR) plan
- Your school has closed
- Your school misled you
- You’re a federal Perkins loan borrower
- You’re a parent borrower
- You’re a victim of forgery
- You’ve declared bankruptcy
- Discharge due to death
What is the SAVE plan?
Millions of Americans are seeing their loans canceled under the Biden administration’s Saving on a Valuable Education (SAVE) plan. It’s one of several IDR plans that provides relief to those who have been paying off their loans for at least 10 years and took out $12,000 or less.
The Department of Education said about 7.7 million people are enrolled in the SAVE plan, but they are encouraging millions more to sign up.
"We need more people to sign up. We're happy we have 7.7 [million] but we want to double that number," Education Secretary Miguel Cardona said. Through the SAVE plan, which was created in 2023, more borrowers are eligible to have their monthly payments reduced to $0. All student loan borrowers in the Direct Loan Program who are in good standing on their loans can apply.
However, the plan is currently under fire by several Republican states. They argue the proposal is an attempt to defy the Supreme Court after it struck down Biden’s previous student loan forgiveness plan.
The lawsuit will likely take several months to work its way through the courts.
What is Biden’s new student loan forgiveness proposal?
The Biden Administration is currently working on a new student loan relief plan to replace the one struck down by the Supreme Court. The Department of Education said the proposal is under review at the Office of Management and Budget, but expects it will move forward this year.
The proposal is designed to help a large number of borrowers who are not already covered by existing loan forgiveness programs.
Details about how much the program will cost or who would benefit have not yet been released. The Department of Education’s website states that the rule under review will include borrowers “whose balances exceed what they originally borrowed, who first entered repayment long ago, who are eligible for relief but have not applied for it, or who attended programs or institutions that failed to provide sufficient financial value.”
The proposal is almost certain to face legal pushback.