793,000 Borrowers Get Student Loan Forgiveness Based On Their Jobs

The Biden administration announced a new wave of student loan forgiveness approvals last week, adding to a growing sum of borrowers who have received debt relief based on their public service employment.

Hundreds of thousands of borrowers working in nonprofit and government jobs have benefited from new reforms that the Education Department has been implementing since 2021. And more relief is coming.

“The Biden-Harris Administration just approved another nearly $5 billion in student loan debt cancellation for 74,000 Americans — the majority of whom are teachers, nurses, firefighters, and other public servants,” said Vice President Kamala Harris in a message on X last Friday. “This is historic progress, but @POTUS and I won’t stop here.”

Here’s the latest.

$56 Billion In Student Loan Forgiveness For Borrowers In Public Service Jobs

In an announcement last week, the Education Department approved $3.2 billion in student loan forgiveness for nearly 44,000 borrowers through “improvements” to the Public Service Loan Forgiveness program.

PSLF can wipe out a borrower’s federal student loan debt in as little as 10 years if they work for qualifying nonprofit or government organizations. But the PSLF program has been plagued by problems since its inception in 2007 including poor loan servicing, rampant misinformation, and insufficient record-keeping. This resulted in many individuals not receiving loan forgiveness relief that federal law provides, despite committing to lower-paid public service careers. To address these issues, the Biden administration has instituted various reforms and improvements.

“Total relief through PSLF is now $56.7 billion for 793,400 borrowers since October 2021,” according to an Education Department statement last week. “Prior to the Biden-Harris Administration’s fixes to PSLF, only about 7,000 borrowers had ever received forgiveness.”

“Woo-hoo! President Biden is cancelling $4.9 billion more in student debt, including for 44,000 public servants - teachers, nurses, and firefighters - who’ve devoted their lives to service,” said Sen. Elizabeth Warren (D-MA) in a statement on X last Friday. Warren has been a longstanding advocate for student loan forgiveness and improvements to PSLF. “I’ll keep working to deliver as much student debt relief to as many people as possible.”

Student Loan Forgiveness Reforms And Improvements For PSLF

The dramatic expansion of relief under the PSLF program has been due to a number of separate but interrelated initiatives by the Biden administration:

• The Limited PSLF Waiver was first enacted in 2021 to temporarily ease rules that had restricted which payments could “count” toward student loan forgiveness under the program. The waiver ended in 2022, but processing is ongoing.
• Many of the waiver’s flexibilities have been extended and expanded by the IDR Account Adjustment, which allows additional prior loan periods — including some periods of deferment and forbearance — to potentially count toward loan forgiveness for PSLF. The Education Department is continuing to update PSLF payment counts under the account adjustment every month.
• New PSLF regulations went into effect last July which codify some elements of the Limited PSLF Waiver and IDR Account Adjustment. The regulations also provide for a new “buyback” option that will give borrowers a safe harbor to get certain past loan periods counted toward loan forgiveness.

New Student Loan Forgiveness Plan Coming?

Meanwhile, the Biden administration is in the process of creating a new student loan forgiveness plan under the Higher Education Act. The Education Department concluded a series of negotiated rulemaking sessions last fall to establish new regulations governing the program. But the rulemaking committee did not reach consensus on many aspects of the proposed plan. Final rules setting the parameters of the program could get published later this spring.

Republican lawmakers have been critical of the administration’s efforts to provide student loan relief.

Biden’s “latest student loan bailout attempt will, like its prior actions, result in significant costs to working-class Americans,” warned Rep. Virginia Foxx (R-NC) in a letter earlier this month to Education Secretary Miguel Cardona. “Coupled with illegal waivers, expansive regulations, and as much as $558 billion in new spending as a result of the administration’s radical SAVE repayment plan, this administration has attempted to spend an unprecedented $1 trillion on loan 'forgiveness' during its first three years in office – all without congressional approval.”

Further Student Loan Forgiveness Reading

If You Work And Have Student Loans, These New Benefits Could Help

3.5 Million Borrowers Will Receive Student Loan Forgiveness Credit For Nonpayment As Servicing Troubles Persist

Enroll Now For Early Student Loan Forgiveness, Says Biden: How To Apply

6 Student Loan Forgiveness Updates To Watch As 2024 Kicks Off