The Biden administration unveiled a new plan July 6 to make it easier for the government to wipe away student loans and end interest capitalization.
The plan seeks to relieve at least one million borrowers for a total of tens of billions of dollars in loans, according to a press release by the Department of Education.
The proposal seeks to forgive student loans for borrowers who had “schools closed or lied to them, who are totally and permanently disabled, and for public service workers who have met their commitments under the Public Service Loan Forgiveness (PSLF) program,” the press release said. The plan also would halt the capitalization of interest on unpaid loans. (RELATED: Democrat Senate Candidate With Massive College Debt Supports Waiving Away Student Debt Loans)
“We are committed to fixing a broken system. If a borrower qualifies for student loan relief, it shouldn’t take mountains of paperwork or a law degree to obtain it,” U.S. Secretary of Education Miguel Cardona said in the press release. “The Biden-Harris Administration is determined to build a more accessible, affordable, and accountable student loan system.”
U.S. Vice President Kamala Harris speaks alongside Education Secretary Miguel Cardona as she delivers remarks on Corinthian Colleges student loan forgiveness, at the Department of Education on June 02, 2022 in Washington, DC. Harris announced the Biden Administration will cancel student debt for over half a million students from Corinthian Colleges, formerly one of the largest for-profit colleges, totalling nearly $5.8 billion in loans. (Photo by Kevin Dietsch/Getty Images)
In April, the Biden administration announced a plan to give 3.6 million borrowers some sort of loan forgiveness with loans for 40,000 borrowers being completely wiped out.
“The proposed regulations released today by the White House are a mixed bag. Some of the changes are quite reasonable while others push the envelope,” American Enterprise Institute Senior Fellow Beth Akers told The Daily Caller News Foundation. “We need significant reform to make existing programs and safety nets work better for students. And some of the changes proposed here would likely do that. But some probably go too far in making benefits available to people who wouldn’t otherwise be eligible.”
According to the Education Data Initiative, 43.4 million Americans hold a total of $1.762 trillion debt.
The DOE did not immediately respond to TheDCNF’s request for comment.
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