WASHINGTON — A student loan cancellation program for Government Workers has provided assistance to more than 1 million Americans — up from just 7,000 approved before it was updated by the Biden administration two years ago.
President Joe Biden announced the milestone Thursday, saying his administration has restored a promise to America’s teachers, firefighters, nurses and other public servants. He celebrated even as his broader student loan plans remain in place stopped by courts next legal challenges by Republican-led states.
“For too long, the administration has failed to meet its obligations,” Biden said in a statement. “We committed to fixing this, and thanks to actions by our government, more than 1 million public servants have now received the relief they are entitled to under the law.”
The Public Service Loan Forgiveness program was created in 2007, promising graduates that the remainder of their federal student loans would be zeroed out after 10 years of working in government or nonprofit organizations. But as of 2017, the vast majority of applicants were rejected due to complicated and little-known eligibility rules.
This is evident from a 2018 report from the Government Accountability Office 99% of applicants were rejectedoften because they did not have the appropriate loan repayment plan in place or because their payments were temporarily suspended due to forbearance or forbearance – periods that were not counted toward the ten years of public service.
The GAO blames the Ministry of Education because he didn’t make the rules clear.
The program was the subject of legal and political battleswith Democrats in Congress calling on the Trump administration to relax the rules and uphold the spirit of the program. Betsy DeVos, then the secretary of education, countered that she faithfully followed the rules passed by Congress.
The Biden administration declared in 2021 that the program was “broken.” temporary remission allowing borrowers to, among other things, obtain credit for prior periods of forbearance or forbearance. A year later, the Department of Education updated the rules to expand eligibility more permanently.
Since then waves of borrowers are approved for cancellation once they reach the 10-year mark. Another 60,000 reached the milestone on Thursday, pushing the total past 1 million. When Biden took office, only 7,000 borrowers had received relief over the past four years.
In total, the program has wiped out $74 billion in loans for government workers.
“I want to send a message to students across America that pursuing a career in the public sector is not only a noble calling, but also a surefire path to becoming debt-free within the next decade,” Secretary of Education Miguel Cardona said in a statement declaration.
After being confronted legal challenges In Biden’s own plans for student loans, his administration has increasingly turned its attention to the record amounts of loan cancellations made through existing programs.
In total, the government says it has now canceled $175 billion for about 5 million borrowers. Government loan forgiveness accounts for most of that relief, while others have had their loans canceled income-driven payment plans and through a 1994 rule that provided relief to students who were cheated by their schools.
Biden campaigned on the promise of widespread student loan cancellation, but the Supreme Court rejected it last year blocked his proposal cancel up to $20,000 for 40 million Americans. Biden ordered his Education Department to try again with a different legal justification, but a judge in Missouri temporarily halted the plan after several Republican states challenged it.
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