Biden Administration Announces It Will Completely Forgive Hundreds of Thousands of Student Loans
The U.S. Department of Education announced on Thursday that more than 320,00 Americans who are classified as permanently disabled will have a total of $5.8 billion in student loans forgiven.
“Over 323,000 borrowers who have a total and permanent disability (TPD) will receive more than $5.8 billion in automatic student loan discharges due to a new regulation announced today by the U.S. Department of Education,” the department said in a news release.
News: Today, ED announced a new regulation that will provide more than $5.8 billion in automatic student loan discharges to over 323,000 borrowers who have a total & permanent disability (TPD). https://t.co/mou1pKDeSR pic.twitter.com/Dg4yd2JiWh
— U.S. Department of Education (@usedgov) August 19, 2021
The department said the change in policy will apply to borrowers who are identified through a data match with the Social Security Administration, and that it will begin next month during the quarterly data match with the SSA.
Currently, those who apply for student debt forgiveness and are disabled are subject to a three-year monitoring period.
The Education Department said in the Thursday announcement it is seeking to end that monitoring period, and also to ensure that borrowers no longer have to provide information about their income.
“Today’s action removes a major barrier that prevented far too many borrowers with disabilities from receiving the total and permanent disability discharges they are entitled to under the law,” Secretary of Education Miguel Cardona said in a statement.
“From day one, I’ve stressed that the Department of Education is a service agency. We serve students, educators, and families across the country to ensure that educational opportunity is available to all,” Cardona added. “We’ve heard loud and clear from borrowers with disabilities and advocates about the need for this change and we are excited to follow through on it.”
“This change reduces red tape with the aim of making processes as simple as possible for borrowers who need support,” he concluded.
The Education Department said the goal of the new changes for permanently disabled borrowers is to ensure their student loan debt is automatically forgiven as it works with the SSA.
That will mean that people who have balances with the federal government will not have to fill out loan forgiveness applications.
“This new regulation allows the Department to provide automatic TPD discharges for borrowers who are identified through administrative data matching by removing the requirement for these borrowers to fill out an application before receiving relief,” the department said.
Borrowers deemed permanently disabled by the Department of Veterans Affairs already do not have to apply as the Education Department cross-references their information with the VA.
The Education Department bragged that since “the Biden-Harris Administration” took office, $8.7 billion in student loans have been discharged for an estimated 455,000 borrowers.
The student debt forgiveness announcement will likely not go far enough for proponents of discharging up to $50,000 in student debt for all borrowers.
Democratic Rep. Pramila Jayapal of Washington used the Thursday announcement to call for a larger debt forgiveness program.
Today would be a great day for @POTUS to finally cancel at least $50,000 of student loan debt per borrower.https://t.co/9aLXnkWObu
— Rep. Pramila Jayapal (@RepJayapal) August 19, 2021
On Wednesday, Democratic Sens. Chuck Schumer and Elizabeth Warren of New York and Massachusetts, respectively, called on President Joe Biden to move forward with canceling the $50,000 in debt for borrowers.
Millions of Americans are struggling under the burden of student debt, and the pandemic has exacerbated this problem.
President Biden can use his existing legal authority to #CancelStudentDebt. https://t.co/i7agEoiu0T
— Chuck Schumer (@SenSchumer) August 18, 2021
Forbes reported Americans currently owe an estimated $1.7 trillion in total student debt.
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