Certain borrowers will be eligible to have the rest of their student loans cancelled as soon as next month, the Biden administration announced.
Starting in February, borrowers who took out less than $12,000 in loans and have been in repayment for 10 years will get their remaining loans cancelled as long as they are enrolled in the Saving on a Valuable Education plan, President Joe Biden said in a statement on 12 January.
It’s not immediately clear how many Americans will be impacted by the move.
The SAVE plan is arriving six months ahead of schedule, the White House said. “This action will particularly help community college borrowers, low-income borrowers, and those struggling to repay their loans,” the statement continued.
Nearly 7 million borrowers are enrolled in the SAVE plan, according to the statement, and 3.6 million have had their loans cancelled already.
Mr Biden also mentioned the Supreme Court’s decision last year, finding that the president lacks the authority to broadly cancel student loan debt.
Following the disappointing ruling, “we are continuing to pursue an alternative path to deliver student debt relief to as many borrowers as possible as quickly as possible,” the statement said.
Mr Biden has long advocated for the cancellation of student debt. Friday’s action shows that the president is keeping a campaign promise.
He encouraged anyone eligible to enrol for the SAVE plan at studentaid.gov.
On Friday, several high-profile political figures praised the announcement.
“This is good news for borrowers and for students wondering if college is within their reach,” Sen Majority Leader Chuck Schumer wrote. “This is an important step in our movement to cancel meaningful student debt. I applaud the Biden admin for taking action.”
Sen Elizabeth Warren wrote, “Woo-hoo! More student debt relief coming for borrowers in Massachusetts & across the country.”
New Mexico Rep Melanie Stansbury also chimed in: “This is a great step. Next: let’s cancel all student debt.”
DNC Chair Jaime Harrison wrote on X: “Just another example of how President @JoeBiden & his administration are working to improve the lives of the American people! No other President has ever done anything this significant to address the student loan crisis!”
