Student Loan Borrowers Urged to Check Emails for Cancellation Eligibility

The Biden administration wants you to check your emails—if you don't, you might miss the news that the Education Department may have cancelled your student debt, in the latest effort by the government to give borrowers relief from their educations loans.

On Wednesday, the Education Department (ED) said that it will forgive $1.2 billion in loans for more than 150,000 students. This move is part of the Biden administration's Saving on a Valuable Education (SAVE) plan that was put forward to accelerate the process of getting borrowers to achieve relief quicker.

To qualify for this latest debt cancellation plan, a borrower would have had to enrol in SAVE, been repaying their loan for at least a decade and borrowed less than $12,000, according to ED. For those students who meet this criteria, they will begin to see messages hitting their inboxes announcing their debt forgiveness. After that, no further action will be needed on their part as debt servicers will work through the process to eliminate that debt for borrowers.

"We are once again sending a clear message to borrowers who had low balances: If you've been paying for a decade, you've done your part, and you deserve relief," U.S. Secretary of Education Miguel Cardona said in a statement shared with Newsweek. "Under President Biden's leadership, our administration has now approved loan forgiveness for nearly 3.9 million borrowers, and our historic fight to cancel student debt isn't over yet."

Borrowers who sign up for SAVE will also qualify for forgiveness, the education department said.

"The U.S. Department of Education (Department) will continue to identify and discharge the loans on a regular basis," the statement noted. "Next week, the Department will start emailing borrowers who can become eligible for this forgiveness if they switch onto SAVE. No action is needed by borrowers who have already enrolled in SAVE."

The latest student loans cancellation by the government brings the total amount of debt erased to $138 billion for nearly 4 million people.

Student loan forgiveness has been a key policy for the Biden administration. An initial plan to cancel debts of up $20,000 was pegged back by the Supreme Court last summer, prompting the government to introduce the SAVE plan. The policy aims to get borrowers to a place where their student debt is forgiven faster. Seven-and-a-half million people have subscribed to the program, according to the government.

An estimated 44 million Americans owe an average of nearly $38,000 in federal student loans, according to figures from the Education Data Initiative as of August 2023. Overall, student debt rose by $30 billion to $1.6 trillion in November, the Federal Reserve Bank of New York said at the end of last year.

Student debt can be debilitating for Americans. On Tuesday, the National Association of Realtors showed that Black Americans struggle to buy homes due to loans they accumulated from their education.

The Biden administration said that the policy of erasing student loans was meant to help the country's middle class.

"From Day One of his Administration, President Biden vowed to fix the student loan system and make sure higher education is a pathway to the middle class—not a barrier to opportunity," the White House said in a statement.