WASHINGTON (AP) — The student loan cancellation program for public employees has granted relief to more than 1 million Americans, up from just 7,000 approved before it was renewed by the Biden administration two years ago.
President Joe Biden announced the milestone Thursday, saying his administration has restored commitments to America’s teachers, firefighters, nurses and other public workers. He celebrated this even as the broader student loan plan remains blocked by courts following legal challenges by Republican-led states.
“For too long, our government has failed to deliver on its promises,” Biden said in a statement. “We vowed to fix this problem, and thanks to the actions of our administration, more than 1 million public servants are now receiving relief to which they are entitled under the law.”
The Public Service Loan Forgiveness Program was created in 2007 and promised college graduates their remaining federal student loans would be reduced to zero after 10 years of work in government or nonprofit positions. However, since 2017, complex and little-known eligibility rules have led to the majority of applicants being rejected.
A 2018 report from the Government Accountability Office found that 99% of applicants were rejected. This is often because they did not have a proper loan repayment plan in place, or because their payments were temporarily suspended through deferrals or forbearances, which did not count toward the forbearance period. I have been involved in public works for 10 years.
GAO accused the Department of Education of not clarifying the rules.
The program has been the subject of legal and political battles, with Democrats in Congress urging the Trump administration to loosen rules and protect the spirit of the program. Then-Secretary of Education Betsy DeVos countered that she closely followed rules passed by Congress.
Declaring the program “broken,” the Biden administration proposed changes in 2021, including temporary waivers that would allow borrowers credit for past forbearance periods and forbearance periods. A year later, the Department of Education updated the regulations to expand eligibility more permanently.
Since then, more and more borrowers have been approved for cancellation after reaching the 10-year term. An additional 60,000 people met the goal on Thursday, bringing the total to more than 1 million. When Biden took office, only 7,000 borrowers had been granted relief in the previous four years.
The program erased $74 billion in loans to public servants.
“We want to send a message to college students across the country that pursuing a career in public service is not only a noble calling, but also a reliable path to becoming debt-free within 10 years,” Education Secretary Miguel Cardona said in a statement. I want to send it.”
Since facing legal challenges to Biden’s own student loan plan, the Biden administration has increasingly turned its attention to the record amount of loan cancellations granted through existing programs.
The government has now announced that it has canceled a total of $175 billion for approximately 5 million borrowers. Public Service Loan forgiveness makes up the largest portion of this relief package, but some people have had their loans canceled under income-based payment plans and a 1994 rule that bails out students cheated by their schools. .
Biden campaigned on a promise of widespread student loan cancellation, but last year the Supreme Court blocked his proposal to cancel up to $20,000 for 40 million Americans. Mr. Biden ordered the Education Department to try again using a different legal basis, but a Missouri judge temporarily halted the plan after several Republican states objected.
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