By Mia Khatib
mia.khatib@triangletribune.com
The Biden-Harris Administration recently announced that 804,000 borrowers will receive automatic student loan forgiveness, totaling $39 billion. Nearly 25,000 North Carolinians are eligible for more than $1.1 billion in this relief.
The forgiveness was made possible through the administration’s improvements to Income-Driven Repayment plans, which sets a borrower’s monthly loan repayments based on their income and family size. Borrowers are eligible for discharge if they have accumulated 20 or 25 years of qualifying months based on their IDR plan and loan type.
“I have long said that college should be a ticket to the middle class — not a burden that weighs down on families for decades,” President Joe Biden said in a statement. “These borrowers will join the millions of people that my Administration has provided relief to over the past two years – resulting in over $116 billion in loan relief to over 3 million borrowers under my Administration.”
The U.S. Department of Education began notifying qualified borrowers July 14 and will continue to do so bimonthly until next year, when borrowers who are not eligible yet will have their payment counts updated. Discharges will begin 30 days after notification, and loan repayments will be paused until the discharge is processed. To opt out of the discharge, eligible borrowers should contact their loan servicers.
Biden added that their new IDR plan cuts undergraduate loan payments in half and eliminates monthly payments for low-income borrowers. U.S. Secretary of Education Miguel Cardona said the system has been failing to accurately keep track of borrowers’ forgiveness progress, and their efforts to fix past administrative failures will ensure everyone receives the forgiveness they deserve.
“Many [borrowers who should’ve qualify for relief] were placed into forbearance by loan servicers in violation of the rules, and others did not get appropriate credit for their monthly payments,” Vice President Kamala Harris said in a statement. “Addressing these harmful practices and reducing student loan debt has been a priority throughout my career.”
