Erasing Student Debt Just Got Easier For Thousands Of Americans

ACROSS AMERICA — Thousands of public servants could find it easier to plow through the labyrinth of a federal student loan forgiveness program after the Biden administration temporarily relaxed requirements Wednesday.

Only about 5,500 teachers, nurses, social workers, military workers and other public service workers have erased their loans since the 2007 launch of the program to steer more college graduates to public service careers.

Thousands more Americans could have been helped, critics have insisted, if not for notoriously complex requirements that have caused 98 percent of Public Service Loan Forgiveness program applicants to be rejected.

The program erases the student loan balance of qualifying workers after they have made 10 years of payments. But the program hasn’t delivered on its promises, so some of the toughest requirements will be temporarily suspended, Education Secretary Miguel Cardona said Wednesday.

Here are five things to know:

1. About 22,000 borrowers don’t have to do anything.

The Education Department says the action will wipe out about $1.74 billion in student debt for 22,000 borrowers who have consolidated loans, including previously ineligible loans, with no action required on their part.

Another 27,000 borrowers are potentially eligible for an additional $2.82 billion in forgiveness if they certify additional periods of employment.

All told, the Education department estimates the changes will move more than 550,000 borrowers closer to forgiveness.

2. The months service members spent on active duty count toward payments, even if their loans were deferred or in forbearance.

Service members automatically get credit without having to submit the paperwork themselves.

Reforms for service members came about as a result of bipartisan legislation co-sponsored by Republican Sen. Marco Rubio of Texas and Democratic Sen. Maggie Hassan of New Hampshire.

3. Other types of loans qualify.

Brrowers who have Family Federal Education Loans, Perkins loans or other non-direct loans also get the benefit of the waiver if they apply to consolidate into a direct loan program and submit a Public Service Loan Forgiveness form by Oct. 31, 2022.

The waiver applies to loans taken out by students.

4. Borrowers can get a do-over.

All loan forgiveness program applications that were rejected will be reviewed to identify and address mistakes. Borrowers who think there was a mistake in processing their applications can be reviewed again in 2022.

5. Promises were broken.

Cardona said the program for people who have served their communities and countries for a decade should be able to rely on the program, but “the system has not delivered on that promise to date.”

“Teachers, nurses, first responders, servicemembers, and so many public service workers have had our back especially amid the challenges of the pandemic,” he said in a statement. “Today, the Biden Administration is showing that we have their backs, too."