U.S. President Joe Biden speaks at Montgomery County Community College on January 5, 2024 in Blue Bell, Pennsylvania.
Almond Ngan | AFP | Getty Images
The Biden administration announced Friday that it will soon begin forgiving student loans for borrowers who have made payments for a decade or more and initially took out $12,000 or less.
To qualify for the relief, which could come as early as next month, borrowers will also have to enroll in the new Savings for Value Education, or SAVE, administration plan.
“SAVE-enrolled borrowers who are eligible for early forgiveness will have their debts immediately canceled beginning next month, without any action on their part,” the U.S. Department of Education said.
The ministry also said it is launching an information and email campaign to get as many eligible borrowers as possible to sign up for its SAVE plan so they can also benefit from the relief. As of early January, 6.9 million borrowers were enrolled in what the administration billed as “the most affordable repayment plan ever created” for student loan borrowers.
“Today’s announcement will help struggling borrowers who have spent years repaying their loans, including many who never graduated from college,” Assistant Secretary James Kvaal said in a statement. “Giving borrowers with smaller loans a faster path to debt-free will help many borrowers avoid financial distress and have peace of mind.”
Under the SAVE plan, the usual term for borrowing student loans is 20 or 25 years. The 10-year period applies to those who chose $12,000 or less in undergraduate or post-secondary education.
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