The White House unveiled a draft expansion of its student debt cancellation plans on Thursday to help reduce financial hardship on struggling borrowers.
The proposal seeks to forgive student debt for borrowers who are likely unable to repay their loans and outlines more than a dozen factors to help determine who qualifies for the forgiveness.
The factors include household income, total debt balance, history of loan repayment, and whether they received a Pell Grant. However, no thresholds for these categories were listed.
“College is meant to lead to a better life, but too many students end up struggling due to their student debt,” Undersecretary of Education James Kvaal said in a statement. “The ideas we are outlining today will allow us to help struggling borrowers who are experiencing hardships in their lives, and they are part of President [Joe] Biden’s overall plan to give breathing room to as many student loan borrowers as possible. It’s an important part of the Biden-Harris Administration’s permanent solutions to the problem of unaffordable loans.”
The Biden administration said it was trying to forgive more student loans while still obeying a Supreme Court ruling handed down last year. Student loan cancellations are a major focal point for Biden’s presidential agenda and reelection campaign.
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It also expands on the Biden administration’s Saving on a Valuable Education plan, which is already helping seven million borrowers, including 3.9 million with a $0 monthly payment. The Biden administration also announced last month it would cancel $5 billion in debt for 74,000 student loan borrowers who spent decades working in public service jobs.
The proposal will be debated next week, and an updated version of the plan is expected to be released for public comments in May.
