Biden announces some student loan borrowers will have remaining debt canceled next month

The Biden administration announced Friday that some student loan borrowers will have their remaining debt canceled next month.

As part of the Saving on Valuable Education (SAVE) plan, borrowers who took out less than $12,000 in student loans and have been paying on them for 10 years will have the debt canceled in February, five months ahead of schedule.  

The administration did not detail how many individuals this would impact but said the primary beneficiaries would be low-income borrowers, those who are struggling to pay back loans and those who went to community college.  

“And, it’s part of our ongoing efforts to act as quickly as possible to give more borrowers breathing room so they can get out from under the burden of student loan debt, move on with their lives and pursue their dreams,” President Biden said in a statement.  

The plan is already facing pushback from Republicans, who have consistently opposed Biden’s student debt relief actions that have wiped the loans for more than 3.5 million Americans.  

“President Biden is downright desperate to buy votes before the election — so much so that he greenlights the Department of Education to dump even more kerosene on an already raging student debt fire. It would surprise no one if the Department relied on infants playing with abacuses to balance its books — it is a complete and utter disaster,” House Education Committee Chair Virginia Foxx (R-N.C) said.  

“It’s clear that the Biden administration needs a good old-fashioned dose of fiscal common sense — all it knows how to do is spend like a drunken sailor,” Foxx added.  

Biden accelerated the student debt relief portion of his SAVE plan, which allows those who borrowed less than $12,000 to get relief after 10 years of payments. From there, every $1,000 adds an extra year, maxing out at 20 years for undergraduate loans and 25 years for graduate loans.

In July, other portions of the SAVE plan will take effect, such as changing payments from 10 percent of discretionary income to 5 percent.

The SAVE plan went into effect last year, with provisions such as more Americans qualifying for $0 monthly payments and unpaid interest not accumulating.

The Biden administration says almost 7 million people have signed up for the SAVE plan, and almost 4 million have $0 monthly payments.