'Congratulations!' Biden emails 153k student loan borrowers, forgiving $1.2B in debt

Nearly 153,000 Americans woke up to unexpected good news on Wednesday morning. The U.S. Department of Education emailed borrowers enrolled in the Saving on a Valuable Education (SAVE) plan a message from President Biden that it had erased $1.2 billion in student loan debt:  “Congratulations—all or a portion of your federal student loans will be forgiven because you qualify for early loan forgiveness under my Administration’s SAVE Plan,” read the message from the President.

“With today’s announcement, 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,” Education Secretary Miguel Cardona said. “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.”

The SAVE plan has become a key vehicle for the administration since the U.S. Supreme Court last year struck down its plan to forgive hundreds of billions of dollars in federal student loan debt. Republican lawmakers have tried to stop the SAVE plan, arguing that it is outside of the administration’s authority and criticizing the president for campaigning for votes with the new policy

The administration announced in January that it was accelerating the forgiveness component of the SAVE plan nearly six months earlier than anticipated to provide borrowers the relief they have earned as quickly as possible. For borrowers to be eligible for this forgiveness, they must:

• Be enrolled in the SAVE plan;
• Have been making at least 10 years of payments: and
• Have originally borrowed $12,000 or less for college.

For every $1,000 borrowed above $12,000, a borrower can receive forgiveness after an additional year of payments. All borrowers receive forgiveness after 20 or 25 years, depending on whether they have loans for graduate school. The benefit is based on the original principal balance of all federal loans borrowed to attend school, not what a borrower currently owes or the amount of an individual loan.

The administration now has canceled some $138 billion in student debt, the White House said. Cardona defended the loan-forgiveness initiatives in an interview with NPR: “The Supreme Court rejected the president’s most bold plan to provide debt relief in our country’s history using the Heroes Act,” he said. “It was pandemic-related. The Supreme Court struck that down. However, the mentality of making higher education more affordable has never diminished in this administration.

Related: Biden cancels another $5B in student debt for borrowers in public service

“We use the Higher Education Act, the authority that it gives me as Secretary of Education, for example, to make payment plans based on income. We’re using the negotiated rulemaking process to come up with a debt-relief plan that will positively impact Americans and give them an opportunity to get back on their feet. We’re unapologetic about this.”

Progressive and young voters have been vocal in advocating for student loan forgiveness on a wide scale. Republicans largely oppose such actions.