Biden Administration Introduces New Student Loan Forgiveness Program

The Biden Administration is once again attempting to erase federal student loans for nearly 153,000 borrowers.

On Wednesday the President announced a new repayment plan he calls the SAVE program, this just nine months before the general election where it looks like he's going to be going up against Donald Trump.

"Too many Americans are saddled with unsustainable debt in exchange for a college degree, said Biden.

"When people have student debt relief, they buy homes. They start businesses, they contribute. They engage."

Biden said the first Americans to have their debt cancelled will be those who have paid their loans for 10 years and borrowed $12,000 or less. They will need to enroll in the SAVE student loan repayment plan.

"That's 150,000 Americans and counting" and $1.2 billion in loans.

The Biden Administration claims said-borrowers who qualify will get an email from the President notifying them that "all or a portion of your federal student loans will be forgiven because you qualify for early loan forgiveness under my Administration's SAVE Plan."

In Wyoming, only 150 people qualify. This per an email from the U.S. Department of Education who wrote that they've identified $1 million that could be forgiven state-wide.

Texas, in comparison, could be forgiving $116.8 million in student loan debt. California is the second highest amount eligible for forgiveness with $114.6 million.

Borrowers who enroll in the SAVE plan that do not qualify for the first round of debt cancellation may still be eligible based on how much they borrowed and how long they've been paying their student loans.

For every $1,000 borrowed above $12,000, they need to have paid an additional year on top of 10 years.

For example, if you borrowed $15,000 you would need to have made payments on that debt for at least 13 years to be eligible.

The maxmimum repayment period is capped at 20 years for those with undergrad loans and 25 for those with post-grad ones.

The Biden Administration is currently writing proposed regulations that would make more borrowers eligible for loan forgiveness and will hold another session of negotiated rulemaking to discuss a proposal to provide loan forgiveness for borrowers experiencing hardship this week.

The SAVE plan is also offering lower monthly payments for borrowers based on their income and family size.

In 2023 Biden attempted to clear student debt up to $20,000, wiping out debt for an estimated 43 million Americans and costing about $400 billion.

However, in June of 2023, the Supreme Court killed the relief plan ruling that the President did not have the authority to forgive federal student loans under a 2003 law called the HEROES Act.