Student Loan Forgiveness Expanded

The Department of Education announced that it is expanding student loan forgiveness through the Income-Driven Repayment (IDR) plan and Public Service Loan Forgiveness (PSLF). The proposal would compensate borrowers who should have already received loan forgiveness.
 
The Education Department’s actions are also intended to make up for the poor administration of the program since its inception. The announcement came a day before the Government Accountability Office released a scathing report on the long-term management of IDR across multiple administrations. 
 
The Department is planning to do the following: 

• Conduct a one-time account adjustment to count forbearances of 12 consecutive months or 36 cumulative months toward IDR and PSLF forgiveness; 
• Restrict the ability of student loan servicers to enroll borrowers in forbearance by text or email, conduct an external review of patterns of forbearance use, and work in partnership with the Consumer Financial Protection Bureau to do regular audits of forbearance use; and 
• Include a one-time revision of IDR payments to address past inaccuracies and also begin displaying IDR payment counts for individual borrowers so they can easily track their progress toward forgiveness. 

These actions, which will provide forgiveness to 40,000 plus borrowers, are part of the Department’s commitment to address historical failures in the administration of the federal student loan program and support student loan borrowers through the pandemic. These changes will be implemented immediately, but borrowers may not see the effect in their accounts until the last quarter of 2022.
 

For more information, please contact:
Emmanual Guillory