President Joe Biden announced new rules on July 31 that make millions more borrowers eligible for student loan debt relief.
“Today, my Administration took another major step to cancel student debt for approximately 30 million Americans,” Biden said.
“We won’t stop fighting to provide relief to student loan borrowers, fix the broken student loan system, and help borrowers get out from under the burden of student debt.”
Starting on Aug. 1, the Education Department will send emails to all borrowers with at least one outstanding federal student loan with updates on potential debt relief and a notice of the Aug. 30 deadline to call and opt out if they are not interested in the program. The email does not guarantee eligibility.
The department will finalize the rules this fall, based on the administration’s existing work to provide $168 billion in student loan relief to nearly 4.8 million borrowers. If the rules are finalized as proposed, the number of borrowers eligible for student loan relief will climb to more than 30 million, including those already approved.
“These latest steps will mark the next milestone in our efforts to help millions of borrowers who’ve been buried under a mountain of student loan interest, or who took on debt to pay for college programs that left them worse off financially, those who have been paying their loans for twenty or more years, and many others,” Education Department Secretary Miguel Cardona said in a statement.
The administration released its first set of draft rules in April, directing Cardona to grant further student loan debt relief to tens of millions of borrowers nationwide, including those with balances growing from years of interest.
If finalized, the rules would allow Cardona to provide partial or full debt relief to borrowers who owe more than they did at the start of repayment, those who have been in repayment for more than 20 years, those eligible for loan forgiveness but have not yet applied, and those enrolled in low-financial value programs.
The Education Department said if the rules are approved, the proposed relief would automatically apply to eligible borrowers.
Borrowers who instead want to opt out of debt relief can do so by contacting their servicer by Aug. 30, but will not be able to opt back into the program.
Currently, the Biden–Harris administration has approved $69.2 billion for 946,000 borrowers through fixes to Public Service Loan Forgiveness, $51 billion for more than a million borrowers through adjustments to income-driven repayment counts, and $28.7 billion for more than 1.6 million who were “cheated by their schools, saw their institutions precipitously close, or are covered by related court settlements.”
The administration also granted $14.1 billion to more than 548,000 borrowers with total and permanent disabilities and $5.5 billion to 414,000 borrowers through the SAVE Plan.
“From day one of my administration, I promised to fight to ensure higher education is a ticket to the middle class, not a barrier to opportunity,” Biden said.
“I will never stop working to make higher education affordable and to make sure our administration delivers for the American people.”
