The Biden administration announced on July 14, 2023, that it would forgive $39 billion in student loan debt for more than 800,000 borrowers. The relief is being provided to borrowers who have made qualifying payments under income-driven repayment plans.
The IDR plans are a set of federal student loan repayment plans that cap monthly payments at a percentage of borrowers’ discretionary income. After making 20 or 25 years of qualifying payments, the borrower’s remaining loan balance is forgiven.
The Biden administration’s announcement is the latest in a series of moves to address the student loan debt crisis. In the past two years, the administration has provided over $116 billion in loan relief to over 3 million borrowers.
The $39 billion in student loan forgiveness announced on July 14 is the largest single-day student loan forgiveness announcement in history. It is expected to benefit borrowers who work in public service, borrowers who are disabled, and borrowers who have been defrauded by their schools.
The announcement has been met with mixed reactions. Some borrowers have welcomed the relief, while others have criticized the administration for not doing more to address the student loan debt crisis.
The Biden administration has said that it is committed to finding additional ways to provide student loan relief. It is unclear what other actions the administration may take in the future.
