Biden administration revises student loan cancellation program

The Education Department said Tuesday it will temporarily allow student borrowers to claim credit on all federal loan and repayment programs for remission.

The agency said it was doing so to “restore the promise” of the Public Service Loan Forgiveness Program (PSLF), which cancels student loans for people who have worked in the eligible public service for 10 years and made 10 years of payments on federal loans. .

The program was designed to reward public service, but the education ministry said that promise was often not kept.

Called a limited PSLF waiver, the change will expand the types of payments that student borrowers working in the public service can count towards the student loan exemption and will apply to those with direct loans, consolidated into the program. direct loans or have applied for direct loans program. loan program while the waiver is in effect.

The agency estimated that this temporary waiver will help more than 550,000 borrowers and allow about 22,000 borrowers to be eligible to have their loans automatically canceled.

In addition to this waiver, the Education Department said it will review “all refused PSLF applications and PSLF processing practices” to correct errors and seek to streamline the PSLF process.

The waiver will last until October 31, 2022.

The Department of Education has recommended borrowers see what type of loan they have by going to StudentAid.gov and going to the “My Help” page, acknowledging that many borrowers don’t actually know what types of loans they have. .

The PSLF program has long been criticized for being overly complex, with many missteps and errors in the program, often resulting in public service workers being denied loan forgiveness. As the Associated Press noted, more than 90 percent of PSLF applicants are rejected, leaving many borrowers with debts they believe would be canceled after a certain point.

In its 2021 budget proposal, the former President TrumpDonald Trump Biden Announces On The Money Arts & Humanities Endowment Nominations – Presented By NRHC – Democrats Break Debt Ceiling Rubicon Trump Backs Diehl For Massachusetts Governor, Slams ‘RINO’ Baker MORE had sought to end the program, having offered to close it for most of the years he was in power.