This fall, the Public Service Loan Forgiveness program, put in place in 2007, will see a sweeping overhaul after over a decade of declining applications for loan forgiveness.
Through the program, college graduates were offered the chance of loan forgiveness if they worked as a teacher, police officer, or government worker and made payments for ten years. At the end of the ten years, any student debt they had left would be forgiven.
However, since the program's inception, thousands of graduates have applied for forgiveness, and the federal government has rejected nearly all of them.
On Wednesday, the Education Department announced that it was making changes in the program and would be immediately erasing the debt of 22,000 borrowers, totaling $1.7 billion, USA Today reported.
It was also estimated that another 27,000 borrowers could see almost $2.8 billion in debts forgiven if they proved they were employed in an eligible job.
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The changes will now let borrowers correct errors and count payments they were attempting to make toward the program. In addition, the change will make the time frame of more than 550,000 powers who are trying to qualify for the program, the government said.
When President Joe Biden ran for office, he did so with the hopes of putting student loan forgiveness policies in place for the more than $1.7 trillion of student loan debt in the country. This change to the program is his first effort to do so.
"Borrowers who devote a decade of their lives to public service should be able to rely on the promise of Public Service Loan Forgiveness," Education Secretary Miguel Cardona said. "The system has not delivered on that promise to date, but that is about to change for many borrowers who have served their communities and their country."
Initially, the program required borrowers seeking forgiveness to work in a job that the government deemed public service, make 120 payments through the appropriate income-based repayment plan, and have direct loans — loans made by the federal government, not private lenders.
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With tens of thousands of people qualifying for the program, almost all messed up one piece of the criteria, making them ineligible for forgiveness.
With 1.3 million people trying to have their debts erased through the program, only 16,000 have seen their debt forgiven, according to the Education Department.
For more information on the updates to the program or to apply for student debt forgiveness, visit the Education Departments' website here and apply by October 2022.
