How Government And Nonprofit Workers Are Getting Billions In Student Loan Debt Canceled
The Public Service Loan Forgiveness program has been streamlined and overhauled to increase the acceptance rate.
The , which the in 2007 to encourage people to work for the government and nonprofits, has grown significantly during Joe Biden鈥檚 presidency. The Conversation asked to explain what this student loan program is, who is eligible and what has changed lately.
How Does It Work?
To qualify, borrowers must currently work for the government or a nonprofit.
include many nurses, teachers, first responders, and social workers.
Once enrolled, borrowers can have their remaining student loan balance forgiven if they remain employed in public service and .
The government can the Department of Education makes through this program. Any student debt that borrowers outstanding.
Why Are Many More Loans Being Forgiven Now?
Borrowers began to apply in 2017, after the requisite decade of on-time payments, for their remaining balances to be forgiven. However, were .
The were . after holding up their end of the deal but with debts they didn鈥檛 believe they should have to repay. Some of them filed a class-action lawsuit, which in 2021.
Recognizing these concerns, the government the Public Service Loan Forgiveness program.
The Department of Education in 2021. The federal government expanded the types of loans that are eligible for forgiveness and .
However, most student loan borrowers did not see the impact of this change until October, when for other borrowers after being paused starting in March 2020 because of the Covid-19 pandemic.
How Much Debt Has Been Forgiven So Far?
An estimated through this program. That鈥檚 more than one-third of the roughly the Biden administration says it has approved through late 2023 for , through several programs.
But the deleted debt has chipped less than one-tenth of the total outstanding debt off the government鈥檚 ledgers. About in federal student loan debt. Some of the Biden administration鈥檚 efforts to cancel larger chunks of this debt have that went all the way to the Supreme Court.
The total amount of student debt, including both the federal and private varieties, because the value of the student loans paid off or forgiven exceeded the value of new student loans being issued.
There is currently no expiration date for the Public Service Loan Forgiveness program. However, some borrowers have only to try to consolidate their student loans so they can qualify for this program and some other kinds of student loan forgiveness.
What About People In College Now Or Going Soon?
Current and future college students will also be able to apply to the program if they embark on public service careers.
There are also several that student loan borrowers can apply for. The monthly student loan payment under these plans is typically monthly discretionary income, depending on the specific plan.
Any remaining loan balances will be forgiven of on-time monthly payments. People who participate in an income-driven repayment plan can also apply to the Public Service Loan Forgiveness program.
An estimated in loans forgiven based on making their student loan payments for the past 20 years.
What Else Is Going On With Student Debt Forgiveness?
Over the past few decades, many Americans took out student loans to attend a . Others took out loans to enroll in schools that went out of business before those borrowers could complete their degrees. The Biden administration has made it easier for these people to have their loans canceled through the .
And the Biden administration has canceled $11.7 billion in debt owed by almost 513,000 borrowers with a .
In addition, many borrowers have loan balances that have what they originally borrowed. And there are Americans who have been paying on their . The Department of Education is also considering making these former students eligible for loan forgiveness.
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