New Delhi: The Joe Biden government in United States has decided to forgive USD 39 billion in student debt for over 8,04,000 borrowers, the Education department said Friday, reported news agency Reuters. The decision comes in the wake of a USD 400 billion student loan forgiveness plan that the Supreme Court struck down in June.
According to the US Education Department, it will start notifying the eligible borrowers and continue to identify those who are eligible every month till next year. Discharges will start within 30 days after email notifications are sent, stated the report.
“For far too long, borrowers fell through the cracks of a broken system that failed to keep accurate track of their progress towards forgiveness,” Bloomberg quoted Education Secretary Miguel Cardona as saying.
Borrowers will reach the threshold of eligibility for loan forgiveness if they have made either 20 or 25 years of monthly income-driven repayment (IDR) payments, the department said, as reported by Reuters.
Also, this loan forgiveness plan has been initiated keeping in mind the borrowers who had made partial or late payments.
"These borrowers will join the millions of people that my administration has provided relief to over the past two years – resulting in over $116 billion in loan relief to over 3 million borrowers under my administration," Biden in a statement said.
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The US administration "will continue to fight to make sure Americans can access high-quality postsecondary education without taking on the burden of unmanageable student loan debt,” Reuters quoted Vice President Kamala Harris as saying.
According to the report, the relief is a result of fixes to the student debt system’s income-driven repayment plans of the government.