Biden announces early student debt cancellation for some borrowers
The announcement applies to borrowers enrolled in a new income-driven repayment plan who took out less than $12,000 in loans and have been in repayment for 10 years.
President Joe Biden announced Friday that federal student debt will be wiped out for certain borrowers who took out relatively small loans and have been in repayment for the past decade.
Borrowers who received less than $12,000 in federal loans and have been paying off their balances for at least 10 years "will get their remaining student debt cancelled immediately" in February, Biden said in a statement.
He said that the move comes "nearly six months ahead of schedule" and that it applies to borrowers enrolled in the new income-driven repayment plan known as SAVE, which administration officials touted in recent months as a way to help lower their monthly payments.
While 30 million people are eligible for the SAVE plan, Biden said Friday that 6.9 million are currently enrolled. It was not immediately clear how many borrowers would be affected by the cancellation effort.
"This action will particularly help community college borrowers, low-income borrowers, and those struggling to repay their loans," Biden said in his statement.
Rating: 5