Over the past few years, the Biden administration has made enormous headway in forgiving or modifying millions of loans for former students, even against some pretty strong opposition through student loan forgiveness initiatives.
While initial plans were scuttled by the legislature, we’ve seen plans like IDR (income driven repayment) plans and the president’s SAVE program (Saving on A Valuable Education) actually save borrowers vast sums of money. Millions of student loan debts were erased. Now, millions more have found their monthly payments capped, to some extent, on what they can afford based on their income.
Expanding Debt Relief in 2024
Some of the newest announcements are around an additional $5.8 billion under the PSLF (Public Service Loan Forgiveness program). That brings the total legacy of the administration’s aid to $143.6 billion for nearly 4 million borrowers.
Addressing Past Logistical Hurdles
“For too long, our nation’s teachers, nurses, social workers, firefighters, and other public servants faced logistical troubles and trap doors when they tried to access the debt relief they were entitled to under the law. With this announcement, the Biden-Harris Administration is showing how we’re taking further steps not only to fix those trap doors, but also to expand opportunity to many more Americans,” said U.S. Secretary of Education Miguel Cardona in a press release announcing the move. “Today, more than 100 times more borrowers are eligible for PSLF than there were at the beginning of the Administration. The Biden Administration is turning a promise broken under our predecessor into a promise kept.”
Supporting Student Efforts
According to a press release, Biden will send supportive emails to students making genuine efforts to fund their education, facing challenges afterward.
PSLF and SAVE Programs for Student Loan Forgiveness
The SAVE program complements PSLF, offering additional opportunities for undergraduate students. Borrowers eligible for PSLF can also benefit from the SAVE plan, especially in professions like teaching and social work.
This urban.org article from last year shows how borrowers can work with both programs, pointing out that the SAVE plan will provide additional opportunities for undergraduate students:
“Borrowers who qualify for the Public Service Loan Forgiveness (PSLF) program—which forgives debt for borrowers working in a wide range of government and nonprofit jobs after 10 years—can also use the SAVE plan and are likely to receive some of the largest benefits from the new plan,” writes Jason Delisle. “This brief examines how much borrowers from two large professions that are typically eligible for PSLF, teaching and social work, could benefit from the SAVE plan.”
The piece also details how borrowers can strategize to make sure that they are not strangled by high student loan debt after they graduate.
If there’s a common sense way to set up these programs, it’s similar to the current process of establishing eligibility requirements according to different types of vocational training.
If there is a bad faith effort to criticize these initiatives, it’s complaining that any aid at all is “forgiveness” and that these things should be left to the private sector.
However, as you can see from following our blog, when you leave it to the private sector, they prove again and again that they are not responsible with borrowers’ money.
Addressing Accountability Concerns
Take the IDR plan, for example, where lenders and loan services were misreporting a student borrower’s income to the tune of $1 million. Or think of the millions who called lenders last October but never reached anyone.
In so many cases, the lenders simply shirked their responsibility, and left borrowers holding the bag.
Conclusion
These recent efforts are meant to start providing equity and fairness for so many individuals trying to pay for college in a difficult economic environment that many would say is really slanted against them.
