Who qualifies for Biden’s $39B Student loan forgiveness plan? 800k to be benefited.

The US Department of Education has introduced a modification to a longstanding program’s technical requirement, resulting in the forgiveness of $39 billion in student debt. This update, announced on Friday, is expected to benefit over 804,000 borrowers. The decision comes in response to the Supreme Court’s rejection of a $400 billion student loan forgiveness plan proposed by the Biden administration in June. President Joe Biden has referred to this recent action as a continuation of his administration’s commitment to “bring the promise of college to every American.”

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Who is eligible?

Under the new plan, a greater number of payments will be taken into account for a forgiveness program that activates when borrowers facing financial difficulties have made payments equivalent to either 20 or 25 years.

“For far too long, borrowers fell through the cracks of a broken system that failed to keep accurate track of their progress towards forgiveness,” Education Secretary Miguel Cardona said in a statement.

Income-driven repayment plans offer a solution for financially challenged borrowers by enabling them to make reduced payments. It is important to note that these plans differ from President Biden’s broader initiatives aimed at addressing the overwhelming issue of student debt, which surpasses a staggering $1 trillion.

“We will not stop there,” Vice President Kamala Harris said in a statement. “Our administration will continue to fight to make sure Americans can access high-quality post-secondary education without taking on the burden of unmanageable student loan debt.”

Starting on Friday, the Education Department initiated the process of informing eligible borrowers, and they have announced their commitment to identifying individuals who meet the eligibility threshold every month until the following year. Discharges of student loan debt will commence within 30 days of sending email notifications to the eligible borrowers.

Representative Virginia Foxx, a North Carolina Republican who chairs the Education and the Workforce Committee and opposes forgiveness, called the change announced Friday “illegal” and “shameful.”

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