The Biden-Harris Administration has released a new plan to eliminate student debt for millions of Americans.
The proposals address challenges faced by President Joe Biden's original loan forgiveness plan, which was blocked by the Supreme Court last year.
"In total, these plans would fully eliminate accrued interest for 23 million borrowers, would cancel the full amount of student debt for over 4 million borrowers, and provide more than 10 million borrowers with at least $5,000 in debt relief or more," the White House said in a statement. "While Republican elected officials try every which way to block millions of their own constituents from receiving student debt cancellation, President Biden has vowed to use every tool available to cancel student debt for as many borrowers as possible, as quickly as possible."
The White House said a major part of the plan addresses runaway interest for millions of borrowers. If enacted, it would cancel $20,000 in unpaid interest for any borrower, regardless of income, as soon as this fall.
"Millions of borrowers across the country owe more than they did when they started repaying because of accrued and capitalized interest. Black and Latino borrowers are likelier to experience growth in their student loan balances due to excessive interest accumulation," the announcement said. "The Administration's plan would forgive interest balances built up to date for 25 million borrowers, with 23 million likely to have all of their balance growth forgiven."
Under the plan, debt would be immediately and automatically canceled for borrowers otherwise eligible for relief through the SAVE plan, Public Service Loan Forgiveness, or other forgiveness opportunities like closed school loan discharges but who have not successfully applied for that assistance.
The plan would cancel student debt for more than 2.5 million borrowers who entered repayment over 20 years ago and still carry debt. It would also cancel student debt for borrowers "experiencing hardship paying back their loans."
"This plan could provide relief to millions of borrowers who experience hardship — such as borrowers who are at high risk of defaulting on their student loans, who could be eligible for automatic relief, or families who are burdened with other expenses like medical debt or child care who can apply for relief in the future," the White House said.
To date, the Biden-Harris Administration has approved $146 billion in student debt relief for 4 million Americans through more than two dozen executive actions.