‘A Big Deal:’ Student Loan Forgiveness Approved For 3.6 Million

The Biden administration has so far approved more than $100 billion in student loan forgiveness for millions of borrowers, according to top officials this week, as the Education Department works to implement and accelerate several targeted initiatives. And more student debt relief is in the works.

Student Loan Forgiveness A Big Deal, Says Biden

Following last week’s approval of $9 billion in student loan forgiveness for over 100,000 Americans across a variety of programs, the Biden administration is ramping up its messaging touting its success over the last two years.

“We’ve canceled $127 billion in student debt for nearly 3.6 million Americans,” said President Biden in a tweet on Sunday. “It’s a big deal.”

“This week, President Biden announced an additional $9 billion in student debt relief for 125,000 Americans – bringing the total approved debt cancelation by the Administration to $127 billion for nearly 3.6 million Americans,” said the White House in its own tweet the same day.

Republicans slammed Biden’s student debt relief efforts, however. Mass student loan forgiveness “does nothing to address exploding college costs,” tweeted the Republican-led House Committee on Education & the Workforce. “Benefits the wealthy. Hurts taxpayers, especially those who never went to college.”

Billions In Student Loan Forgiveness Approved

The Education Department has approved the billions in student loan forgiveness across a number of targeted initiatives over the course of the last two years, although efforts have dramatically ramped up during the last several months.

The figure includes billions in student debt cancellation under improvements to the Public Service Loan Forgiveness Program, which offers student loan forgiveness to borrowers dedicated to employment for nonprofit and government organizations. Hundreds of thousands of borrowers have also received significant debt relief through the Total and Permanent Disability discharge program, which is available to borrowers with severe medical issues.

The department has also recently approved over $40 billion in student loan forgiveness under the IDR Account Adjustment, a program designed to remedy past mistakes by the government and its contracted loan servicers in administering income-driven repayment plans. And millions of borrowers who attended schools — mostly for-profit institutions — accused of widespread misconduct are receiving student debt relief through a combination of group discharges and settlements associated with litigation.

More Student Loan Forgiveness Is Coming, Even As Borrowers Face More Challenges

The Education Department continues to evaluate borrowers for relief under these so-called targeted initiatives, which are ongoing. The next wave of borrowers who qualify for student loan forgiveness under the IDR Account Adjustment could be notified by November or December.

The $127 billion in student loan forgiveness approvals is significant, but still represents only a fraction of the nearly $2 trillion in outstanding student debt held by Americans. It also falls short of the estimated $400 billion in student loan forgiveness that the administration expected to approve under President Biden’s one-time student debt relief plan, which was struck down by the Supreme Court over the summer.

However, the Biden administration is moving forward to create a new student loan forgiveness plan. The Education Department released critical new details on this program earlier this month in advance of public hearings that are scheduled to begin this week.

In the meantime, borrowers entering repayment are increasingly facing problems associated with an underfunded and inadequately staffed student loan servicing system. Borrowers are reporting long call hold times and irregularities in calculating monthly student loan payments, as the first student loan bills become due this month following the end of the 40-month student loan pause.