President Biden today announced another $5 billion in student loan
forgiveness for 74,000 borrowers. It's the latest batch of student
debt cancelations after the U. S. Supreme Court struck down his larger
forgiveness plan last year. John Yang has our update on the president's
efforts. Jeff. Today's move will provide relief to nurses, teachers
and other public service employees have been working for at least
10 years. It also includes forgiveness for some borrowers who have
been making loan repayments for 20 years, but never got the relief
they were entitled to under existing programs, and earlier this week,
the administration said it will move up the start date of a new student
loan repayment program. From July to February. So far, the Biden
administration says it's erased more than $130 billion in loans for
3.7 million borrowers. Danielle Douglas Gabriel covers the economics
of higher education for the Washington Post. Danielle. Two announcements
today one a program for public service workers. Another four people
have been repaying their student loans for 20 years, but haven't
gotten the benefits that they were entitled to. How does that work?
Sure. So since the late nineties, there have been what are known
as income driven repayment programs. These are programs that allow
you to pay based on your just portion of your discretionary earnings.
This is supposed to allow you to have more affordable payments make
it easier for folks to manage their law. Jones. Now the promise as
a part of these programs is after 20 or 25 years of payments. You
can get forgiveness for whatever your balances on these laws. Unfortunately,
the Education Department for many years worth keeping count of how
many people actually were making payments on those loans during that
time, so there were hundreds of thousands of people for whom they
had been in payment for 2025 many more years than that and never
received this benefit. So the Biden administration came in and said,
We're going to play cleanup. Essentially, they extend extended these
initiatives that made it a lot easier for people. Who have been paying
for decades to have their loans. Forgiveness. And the news of this
today is what we're seeing as a result of this effort, and also the
program that they're moving up the start date from July to February.
What does it do? And how significant is it? This is all rooted in
Biden's latest from payment plan of commonly known as Save, and One
of the cool features of this plan is that if you borrowed less than
$12,000 originally and had been making payments for 10 years, whatever
your remaining balances would be forgiven, So the Department of Education
was supposed to put that particular feature into effect in July,
but they were able to move it up to February. They're not certain
exactly how many people will benefit from this but do keep in mind.
There are a lot of people who borrowed less than $10,000, who owe
far more than that, because of the way interest accumulated on their
loans. And a lot of those people tend to be at the center of where
we see the most pain in student loan repayments, meaning the people
who default the most people who are delinquent on their loans, oftentimes
because they started college never finished and got the credential
needed to get the kind of work to make it easy to repair. Pay the
debt about the pain of student loans. This is an election year. Polls
show that voters under 45 Ah, I think this is a big issue Loan student
loan Forgiveness is a big issue, And they also feel that Biden isn't
doing enough. Is this piecemeal approach that the president is taking
now that the Supreme Court struck down his bigger program is this
enough for borrowers? Are they satisfied with this? Not seeing that
which I find striking, right? I mean relative to any other administration
in recent history, This administration has forgiven the most amount
of student debt. But because of the failed promise of this widespread
debt relief that would have touched 40 million people, A lot of borrowers
still aren't fully satisfied. Certainly. Ones who are benefiting
from these incremental approaches. They're pretty happy right now
because they don't have to make payments on their loans. But for
the vast majority, there's still trying to push for something that
may not quite happen. I mean, to be fair. The Biden administration
is still fighting for more expansive loan forgiveness through this
negotiated rulemaking process that's still underway, but it's not
what folks were hoping for, and it's certainly not what he I think.
Many people thought he could have delivered. We go from loan repayment
to getting the student loans. The Biden administration also rolled
out the new free application for federal student aid, also known
as FAFSA. They did that at the beginning of the year. How's it going?
Lot better than it started. I think we have more than a million people
now who have submitted passes, which is great. A lot of the technical
troubles that people experience on January 1st December 31st have
largely dissipated from what I'm hearing from folks on the ground.
But there are still some technical issues that some applicants are
facing when their parents try to get a faster I D. Especially if
they don't have Social Security numbers. This is a feature that was
supposed to make it easier for a wider swath of folks. But it hasn't
fully worked out from what I'm hearing. You know, I think the challenge
is filling out the form is one step. There are other steps along
the way, and all of those delays. It kind of has a domino effect.
And so a lot of folks in financial aid are waiting to see how this
plays out and financial aid has to decide what they can offer. Students
and students have to figure out where they can afford to go. But
this is getting pushed back. Yes. So here's the trouble is that the
department while everyone can submit their application now, the department
may not be able to actually provide colleges that information and
that data until the end of this month, if not potentially later,
and that creates a much shorter timeline for financial aid officers
at schools to be able to provide award packages also creates the
complication of missing potential state and other outside scholarship
deadlines that require the Fasten order to apply for that money.
So everyone is really nervous about how well students and families
be able to get this information to make an educated decision about
where to go where they can afford to go if we have this shorter timeline.
Danielle Douglas Gabriel of the Washington Post. Thank you very much.
Thank you.