On July 31, President Joe Biden announced new rules that will significantly expand the number of borrowers eligible for student loan debt relief. The proposed regulations, if finalized, would increase the total number of beneficiaries to more than 30 million, a major step in the administration’s ongoing efforts to address the student debt crisis.
“Today, my Administration took another major step to cancel student debt for approximately 30 million Americans,” Biden stated during the announcement, joined by Education Secretary Miguel Cardona. “We won’t stop fighting to provide relief to student loan borrowers, fix the broken student loan system, and help borrowers get out from under the burden of student debt.”
Starting on August 1, the Department of Education (DOE) will send emails to all borrowers with at least one outstanding federal student loan, providing updates on potential debt relief and information on how to opt-out if they do not wish to participate in the program. The finalization of these rules is expected this fall.
If implemented, the new rules would build on the administration’s previous efforts, which have already provided $168 billion in student loan relief to nearly 4.8 million borrowers. The expanded criteria would include borrowers with growing balances due to interest, those who have been repaying loans for over 20 years, and others in low-financial value programs.
“These latest steps will mark the next milestone in our efforts to help millions of borrowers who’ve been buried under a mountain of student loan interest or who took on debt to pay for college programs that left them worse off financially,” said Secretary Cardona.
The DOE confirmed that if the new rules are approved, eligible borrowers would automatically receive the proposed relief. However, borrowers who wish to opt-out can do so by contacting their loan servicers by August 30, with the stipulation that they will not be able to re-enter the program once opted out.
To date, the Biden-Harris administration has approved substantial relief, including $69.2 billion for 946,000 borrowers through fixes to Public Service Loan Forgiveness, $51 billion for over a million borrowers through income-driven repayment adjustments, and $28.7 billion for 1.6 million borrowers affected by school closures or fraud. Additionally, $14.1 billion has been allocated to more than 548,000 borrowers with total and permanent disabilities, and $5.5 billion to 414,000 borrowers under the SAVE Plan.
“From day one of my administration, I promised to fight to ensure higher education is a ticket to the middle class, not a barrier to opportunity,” President Biden affirmed. “I will never stop working to make higher education affordable and to make sure our administration delivers for the American people.”