Education Department plans to write off student loan debt for millions: report
The federal Department of Education has drawn up detailed plans to cancel student loan debt for millions of Americans if President Joe Biden gives his approval, according to a Politico report.
The Biden administration has been considering for months how to write off student loan debt. More recently, Biden said he expects to make a decision on that by the end of August. This is also when the current pause on federal student loan payments is expected to end.
Documents obtained by Politico detail the mechanics of how the Department of Education plans to manage and operate a massive debt cancellation program that would be unprecedented, the website said.
Officials are prepared to automatically provide debt relief to millions of borrowers for whom the agency already has income information, Politico said. Others would apply via an online form to certify that they are entitled to relief.
The department’s plan says all types of federal student loans would be eligible for forgiveness, including Grad and Parent PLUS loans as well as federal loans held by private entities, according to Politico. The plans also suggest that borrowers who have received Pell grants could qualify for an additional discount.
The Biden administration plans to provide $10,000 in relief per borrower, Politico said.
Ministry documents do not include any final decision on how a relief program would be structured. According to Politico, there are no details on the final amount of relief or the income limits of the potential program.
Officials are considering limiting the forgiveness to borrowers with incomes below a certain income level, but no amount has been finalized, Politico said. An internal departmental presentation cited $125,000 for individuals and $250,000 for families as examples of possible thresholds.
You can find out more about the plans of the department on the Politico website.