President Biden announced the immediate cancellation of federal student debt for borrowers who took out less than $12,000 in loans and have been in repayment for at least a decade.
This applies to those enrolled in the income-driven repayment plan known as SAVE, offering relief ahead of schedule to ease financial burdens.
Out of 30 million eligible individuals for the SAVE plan, President Biden noted that only 6.9 million are presently enrolled.
The precise impact of the cancellation effort on the number of affected borrowers is not immediately clear.
“This action will particularly help community college borrowers, low-income borrowers, and those struggling to repay their loans,” Biden said in his statement.
Following a pause of over three years, numerous borrowers resumed repaying federal student loans in October.
The Supreme Court rejected President Biden’s pandemic-era debt relief plan last year, which aimed to eliminate up to $20,000 in student debt for approximately 43 million borrowers.
