Millions of student borrowers will be closer to debt cancellation after a number of changes the US Department of Education plans to make to the loan system.
The department made the announcement on Tuesday, saying it plans to address “historic failures in the administration of federal student loan programs.”
These changes include reassessing payment terms for borrowers enrolled in income-driven repayment plans and public service loan cancellations and ensuring that they are on track for possible loan cancellation. debt to which these programs lead.
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As many as 3.6 million people could be closer to debt cancellation after these changes, according to the department. About 40,000 borrowers can get immediate relief.
“Student loans were never meant to be a life sentence, but it certainly is for borrowers stuck on the debt relief they’re eligible for,” the US Secretary of State said. ‘Education, Miguel Cardona. “These actions further demonstrate the Biden-Harris administration’s commitment to providing meaningful debt relief and ensuring that federal student loan programs are administered fairly and efficiently.”
Outstanding student debt exceeds $1.7 trillion, weighing more on Americans than credit card or automobile debt. Tens of millions of people in the United States are in debt for their education and up to a quarter are in arrears or in default.