(NewsInsights.org) – White House press secretary Karine Jean-Pierre and Education Secretary Miguel Cardona spoke during a White House press teleconference on Sunday, April 7, to announce that senior Biden administration officials would travel the nation on Monday to announce yet another student debt relief program. President Joe Biden traveled to Madison, Wisconsin, to announce the new measure, while Vice President Kamala Harris, Second Gentleman Doug Emhoff, and Secretary Cardona fanned out to Philadelphia, Phoenix, and New York City.
In the Sunday evening call, Jean-Pierre pointed out that the administration had already helped provide debt relief to more than four million Americans struggling with student loan debt through the Public Service Loan Forgiveness (PSLF) program and the Saving on a Valuable Education (SAVE) Plan. In a press release and fact sheet released on Monday, the administration said the new plans, if finalized as proposed, would help alleviate debt for an additional 26 million Americans struggling with long-term student loans.
The plans would mainly affect borrowers affected by “runaway interest,” who have paid balances on loans for 20 or more years and would qualify for forgiveness under the Income-driven Repayment (IDR) plan, or those experiencing financial hardship. The proposed plans would provide borrowers loan forgiveness of up to $20,000 for balances that have ballooned due to unpaid interest since they began repaying their debts. Additionally, the administration proposed automatically enrolling qualifying individuals in SAVE, IDR, PSLF, and other programs, sparing individuals the frustration of fighting red tape. Under the new plan, the government would forgive qualifying borrowers’ full unpaid interest balance.
The administration estimated the new plan could wipe out remaining student loan debt for as many as 23 million Americans while significantly reducing the debt load for another three million. Additionally, the administration proposed rule changes to assist individuals who borrowed money to attend programs the Department of Education has deemed insufficient to provide borrowers with marketable skills to repay loans or to forgive individuals currently at an elevated risk of default because of other debt, including medical debt.
According to the Administrative Procedure Act (APA), the proposed rule changes become subject to a minimum 60-day comment period. Per The Hill, legal pundits have already suggested likely legal challenges should the administration approve the proposed plans.
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