The Biden-Harris administration today announced the cancelation of another $7.4 billion of federal student debt affecting more than 200,000 borrowers. This brings the total amount of canceled student debt by the administration to $153 billion for around 4 million borrowers. This time around, debt relief will reach debtors enrolled in the SAVE plan, in other income-driven repayment plans and those receiving Public Service Loan Forgiveness.
In July of last year, the Supreme Court had struck down Biden's plan to cancel $430 billion in student loans for around 40 million Americans all at once using the pandemic-era HEROES Act. The administration has meanwhile been chipping away at student debt with smaller cancelations using executive actions and, for example, relief for federal workers, veterans and the disabled. Debt from schools deemed fraudulent was also forgiven.
The amount canceled by Biden so far is about equal to 9.5 percent of all federal U.S. student debt (which stands at $1.6 trillion), while his previous plan would have been equal to 27 percent. Another bigger effort is again in the works: On Monday, the White House announced another plan which looks at forgiving loans for 30 million people. This time, the administration is targeting those whose balance grew after entering repayment due to payments not covering all of their interest.
