President Joe Biden has approved an additional $9 billion in student debt relief for 125,000 borrowers. The move comes just days after federal student loan repayments resumed after more than three years of payment freezes.
Who qualifies?
Borrowers who qualify for the additional debt relief include:
- Borrowers who are part of public service loan forgiveness schemes
- Borrowers who have been in repayment for at least 20 years but have never received relief
- Borrowers with a total or permanent disability
How much debt relief will borrowers receive?
The amount of debt relief that borrowers receive will vary depending on their individual circumstances. However, the average borrower is expected to receive around $7,200 in relief.
When will borrowers receive their debt relief?
Borrowers will begin to receive their debt relief in the coming weeks and months. The Department of Education will contact borrowers directly to let them know when they can expect to see their debt relief.
Quote from Education Secretary Miguel Cardona:
“The Biden-Harris administration’s laser-like focus on reducing red tape, addressing past administrative failures, and putting borrowers first have now resulted in a historic $127 billion in debt relief approved for nearly 3.6 million borrowers.”
Impact on the economy
Economists expect the resumption of student loan payments to slow consumer spending, but they do not believe it will push the U.S. economy into recession.
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