President Joe Biden’s administration forgave another $7.7 billion in student loan debt for about 160,000 borrowers on Wednesday.
The president announced in a statement that he forgave the debt of applicants enrolled under his administration’s Saving on a Valuable Education (SAVE) repayment plan, including teachers, nurses or law enforcement officials. The Supreme Court, in a 6-3 ruling, blocked the Biden administration’s plan in June 2023 to grant student loan forgiveness to nearly 40 million Americans using executive power. The president’s SAVE plan was announced in a response to the ruling. (RELATED: Biden Admin’s New Student Loan Plan Will Involve Zero-Dollar Payments For Millions, No Penalties For A Year)
“Today’s announcement comes on top of the significant progress we’ve made for students and borrowers over the past three years,” Biden said in a statement. “That includes providing the largest increases to the maximum Pell Grant in over a decade; fixing Public Service Loan Forgiveness so teachers, nurses, police officers, and other public service workers get the relief they are entitled to under the law; and holding colleges accountable for taking advantage of students and families. And last month, I laid out my Administration’s new plans that would cancel student debt for more than 30 million Americans when combined with everything we’ve done so far.”
U.S. President Joe Biden speaks as he announces a new plan for federal student loan relief during a visit to Madison Area Technical College Truax Campus, in Madison, Wisconsin, U.S, April 8, 2024. REUTERS/Kevin Lamarque
Biden has now forgiven the student loans of 4.75 million Americans, the president’s statement reads.
The president’s previous actions to cancel $7.4 billion in student debt for 277,000 people through his SAVE plan was expected to cost Americans about $84 billion, according to the Penn Wharton Budget Model. The $84 billion is in addition to the $475 billion that the administration is expected to spend on other previously announced plans, Penn Wharton Budget Model estimated.
Biden announced in August 2023 a new plan to cancel up to $10,000 in student loan debt for non-Pell Grant recipients, as well as up to $20,000 for Pell Grant recipients using the 2003 HEROES Act in response to the Supreme Court’s ruling. The education secretary has the authority under the legislation to “waive or modify” provisions of student financial assistance programs in the event of a national emergency to make sure that recipients are “not placed in a worse position financially.”
