Federal student loans of up to $39 billion are to be canceled under Biden’s new student loan forgiveness plan.
Federal Student Loans To Be Canceled Under The Biden Administration
More than 800,000 borrowers will have their federal student loans canceled by President Biden‘s Department of Education within the next month. The said federal student loans are $39 billion in total. In a statement by Education Secretary Miguel Cardona, the cancellation of federal student loans is a “historic step,” but Republicans were furious.
Republicans heavily criticized the Biden administration for immediately coming up with another student loan forgiveness plan shortly after the Supreme Court struck down Biden’s initial forgiveness plan to erase student debt.
Rep. Virginia Foxx, chair of the House Education and Labor Committee, called the Biden administration’s plainly political work around the Supreme Court’s decision of shutting down the previous forgiveness plan “shameful.” In order to get attention, the Biden administration “tramples the rule of law, harms borrowers, and abuses taxpayers.”
Federal Debt Under The Biden Administration
More than 3.4 million students’ federal debt totaling more than $116.6 billion had their federal student loans canceled by the Education Department since Biden assumed office. Depending on when they took out the loan and their payment arrangement, borrowers who have been repaying their debt for 20 or 25 years are eligible for the new student loan forgiveness plan.
On June 30, Biden proposed payment deferrals for additional student borrowers based on income and requested Cardona to cancel other federal student loans under the Higher Education Act of 1965.