Department of Education to cancel $ 5.8 billion in loans to some students

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Sarah Tew / CNET

Student loan debt hit $ 1.7 trillion in 2020, and Democratic leaders pushed President Joe Biden’s administration to cancel many of those loans. The education ministry says it will write off billions in student debt, but only for some people.

More than 323,000 totally and permanently incapacitated (PDT) borrowers will have $ 5.8 billion in student loan debt released, according to a press release Thursday from the ministry. Forgiveness begins in September for people whose data already exists with the Social Security Administration.

“Today’s action removes a major hurdle that was preventing far too many disabled borrowers from receiving the full and permanent disability releases to which they are entitled under the law,” the secretary said on Friday. Education Miguel Cardona in a press release. and clear from borrowers with disabilities and advocates of the need for this change and we are excited to act on it. This change cuts down on bureaucracy in an effort to make processes as easy as possible for borrowers who need help. “

The ministry also announced that it would stop asking borrowers for proof of income and pursue the elimination of the three-year monitoring period, starting in October.

In March, the ministry canceled $ 1 billion in student debt for borrowers who attended some for-profit colleges, and then another $ 500 million in June.

Biden campaigned on forgiveness $ 10,000 in student debt per borrower, but he has not yet acted. Democratic Senators Chuck Schumer, of New York, and Elizabeth Warren, of Massachusetts, are some of the members of Congress calling for the cancellation of $ 50,000 in student loans. Biden extended the student loan abstention twice since he took office. Borrowers won’t have to repay their student loans until the end of January, and the administration says this is the last extension.

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