Student loan debt: Upward of $6.8 billion has been forgiven, more to come, says DOE

Around $6.8 billion in student debt relief has been made through adjustments to the Public Service Loan Forgiveness Program, the Department of Education announced on Wednesday.

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The DOE announcement said that the changes to the program have allowed more people to become eligible for student loan debt cancellation. The relief provided by the program, which was offered to more than 110,000 borrowers, averaged around $60,000 per person.

Initially, the program offered the cancellation of federal student loans for nonprofit and government employees after 10 years of service, or 120 loan payments.

Hundreds of thousands of borrowers could still see their debt discharged because of the changes to the definition of a “qualified payment,” according to the department.

While some must update their information on the DOE website to take advantage of the waiver, many borrowers don’t have to take any action in order to have the DOE review and update the number of their qualifying payments, CNN reported.

The website offers guidance on the waiver program to help borrowers file to be considered for loan forgiveness. Borrowers have until Oct. 31, 2022, to make any changes to qualify for forgiveness.

If a borrower has either a Federal Family Education Loan (FFEL) or a Federal Perkins Loan, he or she can consolidate those loans into direct loans with a servicer, according to the DOE. Those loans will then be eligible for forgiveness under the program.

FFEL and Perkins Loans don’t normally count for public service loan forgiveness, but do so now, at least temporarily.

President Joe Biden has indicated that he will soon announce a decision on forgiving student loan debt, according to three people aware of administration discussions who spoke to The Washington Post.

Biden aides have examined limiting the relief to people who earned less than either $125,000 or $150,000 as individual tax filers the previous year, the story said.

Biden has said he will not forgive $50,000 in debt, something progressives in his party have pressured him to do. He has suggested he will forgive at least $10,000 in student loans per borrower.

Federal student loan debt payments have been suspended since March 2020, the start of the COVID-19 pandemic.