277,000 More Student Loan Borrowers to Benefit From Biden Debt Relief

April 12, 2024 by Dan McCue
277,000 More Student Loan Borrowers to Benefit From Biden Debt Relief
President Joe Biden in the Rose Garden of the White House earlier this week. (Photo by Dan McCue)

WASHINGTON — The Biden administration announced Friday that it is canceling the student loan debt of another 277,000 borrowers as part of a new repayment plan intended to speed relief to those buckling under the load of excessive educational expenses. 

The dollar value of the latest round of debt cancellations comes to about $7.4 billion, bringing the total loan forgiveness approved by the administration to date to $153 billion for nearly 4.3 million Americans.

The move was the result of changes the administration has made to long standing federal loan repayment plans under the banner of the “Saving on a Valuable Education Plan,” the so-called SAVE Plan. 

Back in the 1990s, when Congress first extended help to people struggling to repay their student loans under the standard plans of the time, the solution was to offer an income-driven repayment option that capped monthly payments as a percentage of income.

Under the terms of that plan, any unpaid debt would be canceled after 25 years. Decades of tweeks followed, with some plans offering debt cancellation in as little as 20 years.

Then came the Biden administration, which sought to rationalize loan forgiveness by merging a number of different plans into one repayment option, and offering borrowers more lenient terms.

Among other things, the SAVE Plan staves off repayments for large swaths of borrowers until their incomes rise about certain specified levels.

It also lowers payments more than past plans, eliminates interest growth and cancels unpaid debt in as little as 10 years.

The loans forgiven Friday are a byproduct of more people becoming eligible for student loan cancellation as they hit 10 years of payments,administration officials said.

“From day one of my administration, I promised to fight to ensure higher education is a ticket to the middle class, not a barrier to opportunity,” President Joe Biden said in a statement distributed by the White House Friday morning.

The White House also sent out a list of fact sheets (see below) detailing how residents of each state fared in the new round of debt forgiveness.

For instance, here in Washington, D.C., 590 people will directly benefit from today’s announcement, bringing the total student loan debt cancellation for the district to $663 million for 10,390 people.

A more granular look at the local total shows that the administration has approved $10 million in debt cancellation for 750 people in the district through SAVE early loan forgiveness; $165 million in debt cancellation for 2,750 people here through fixes to other income-driven repayment plans; $440 million in debt cancellation for 4,900 public service workers; $48 million in debt cancellation for 1,990 people in the district with a total and permanent disability. 

However, the Republican attorneys general of Kansas and Missouri are challenging the legality of the administration’s actions, claiming the White House overstepped its authority when it created the leaner, meaner and faster repayment option.

Kansas Attorney General Kris Kobach led a group of 11 states in filing a lawsuit against the Biden administration student loan forgiveness plan on Thursday.

Kansas was among the six states who successfully challenged Biden’s original student loan forgiveness program before the U.S. Supreme Court last year in the case Biden v. Nebraska

In June 2023, a 6-3 majority on the Supreme Court struck down the earlier version of  Biden’s student-loan forgiveness program on the grounds that the administration overstepped its authority when it tried to cancel up to $400 billion in student loans.

At the time, writing for the majority, Chief Justice John Roberts said the decision was based on a straightforward interpretation of federal law.

Biden, however, said he believed the court’s decision was “wrong” and promised that the “fight is not over.” 

On Thursday, Kobach told reporters he was acting on that vow by implementing a new program with the same inherent issues as the old one, in a blatant attempt to sidestep the Supreme Court’s 2023 ruling

“Not since the Civil War has a president told the Supreme Court, ‘Yeah you blocked me, but I’m gonna do it anyway,’” Kobach told Fox News on Thursday. “Biden is trying to twist federal law once again, and his new plan is just as illegal as the old plan.”

Joining Kansas in its lawsuit are the states of Alabama, Alaska, Idaho, Iowa, Louisiana, Montana, Nebraska, South Carolina, Texas and Utah.

Missouri Attorney General Andrew Bailey also announced plans to challenge the student loan program on Thursday, saying Missouri and Arkansas would be filing their lawsuit in the coming days.

If anyone in the administration is concerned that the latest round of debt forgiveness will also be struck down, they weren’t showing their hand on Friday.

In fact, the White House announced it is  pursuing new plans that, if implemented, would cancel student debt for tens of millions more. 

“I will never stop working to cancel student debt — no matter how many times Republican elected officials try to stop us,” Biden said in his statement on Friday.

State Fact Sheets

Listed below are state-by-state fact sheets spelling out the local impact of Friday’s student loan debt announcement.

Dan can be reached at [email protected] and at https://twitter.com/DanMcCue

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  • Education
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  • Student loan relief
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