President Joe Biden’s administration will automatically wipe a total of $39 billion in federal student loans for more than 804,000 borrowers in the coming weeks, the U.S. Department of Education announced on Friday.
The relief comes just a few months before borrowers have to start repaying their federal student loans after the COVID-19 pandemic triggered a three-year pause.
The administration’s move is a result of fixes to the student loan system’s income-driven repayment plans that ensure all borrowers have an accurate count of the number of monthly payments that qualify toward forgiveness.
“Nearly a million borrowers who have been trapped in decades of never-ending payments will finally get the relief Congress intended,” Persis Yu, deputy executive director and managing counsel at the Student Borrower Protection Center, said in a statement.
“This is only the tip of the iceberg,” Yu said. “Working people with student loan debt have been made collateral damage by a dysfunctional student loan system.”
The Biden administration and education department have also created a new repayment plan called Saving on a Valuable Education (SAVE).
The SAVE plan will cut payments on undergraduate loans in half, ensure that borrowers’ balances don’t grow as long as they keep up with their required payments and allow borrowers to save more of their income for basic needs, according to the Department of Education.
note that (if you didn’t read the article) this is only “wiping out” debt for
Student loan borrowers on income-driven repayment plans who have made 20 or 25 years of payments will get their remaining balances wiped out in coming weeks, the Education Department said. Eligible borrowers will be notified starting Friday. A total of $39 billion will be forgiven as part of a one-time adjustment to loan repayment plans the Biden administration announced last year.
Unfortunately, the new payment system (SAVE) is only for those who make less than $32,800 per year ($67,500 for a family of four). The rest of us are going right back to getting bent over, making payments on loans that never seem to go down.
So, less than 10% of the previous amount, for very specific borrowers, and decreased collection on loans that never should have had such high interest rates to begin with (or really, they should have no interest - it’s an investment in the people, and their taxes go up with their income. That’s where the government makes it’s money back.)
Not enough. Disband the fucking Supreme Court or pack judges. Bring in a better representative number in House and Senate. It doesn’t matter anymore because public trust in government, and especially in the SCOTUS is dead.
