40,000 students' debt erased, almost 4M on the table for further breaks
DOE wipes debt of 40k borrowers, millions more may be next
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Thousands of current and former students have had their debt wiped clean, with the possibility for further breaks on the horizon.
Federal Student Aid estimates that approximately 40,000 individuals will receive "immediate debt cancellation" under new guidelines for the Public Service Loan Forgiveness Program.
"Student loans were never meant to be a life sentence, but it’s certainly felt that way for borrowers locked out of debt relief they’re eligible for," U.S. Secretary of Education Miguel Cardona wrote in the release. "Today, the Department of Education will begin to remedy years of administrative failures that effectively denied the promise of loan forgiveness to certain borrowers enrolled in IDR plans."
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"These actions once again demonstrate the Biden-Harris administration’s commitment to delivering meaningful debt relief and ensuring federal student loan programs are administered fairly and effectively," he added.
President Biden speaks during an event about the Affordable Care Act at the White House on April 5, 2022. (AP Photo/Carolyn Kaster / AP Newsroom)
President Biden has twice extended a pause on student loan payments, which first started in March 2020 to alleviate the economic fallout from the COVID-19 pandemic and response. The freeze is set to expire after April 30, but multiple outlets have reported that the White House will extend the pause through Aug. 31.
The new measures are meant to repair and make good on "forbearance steering" – a practice of pushing borrowers towards small payments without taking away from the principal. This and other unhelpful tactics are now being combated by the Department of Education.
Education Secretary Miguel Cardona visits Bergen Community College in Paramus, New Jersey, Jan. 20, 2022. (AP Photo/Seth Wenig, File / AP Newsroom)
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Rep. Ro Khanna said he's concerned student loan debt could prevent Americans from starting families or buying homes.
"It leads to young people not wanting to have families," the California Democrat told Fox News. "It means young people aren't able to buy homes."
Khanna said opponents of student loan forgiveness argue that if they or their parents paid for student loans, then everyone should. The congressman said he has "so much admiration for parents who made those sacrifices for their kids."