(Photo: Jim Watson/AFP)
The Dept. of Education announced Thursday that 72,000 student loan borrowers will have the entirety of their student loan debt forgiven.
The $1 billion cancellation of loan debt only applies to borrowers whose claims have already been approved under a federal law called borrower defense to repayment. The law allows students to have their loans canceled if they attended a school that closed suddenly or was proven to have taken part in illegal or deceptive practices.
The borrowers have already received partial loan forgiveness under former President Donald Trump, now the loans will be fully forgiven.
The defense to the repayment law was strengthened when former President Barack Obama was in office, however under the Trump administration, former Secretary of Education Betsy DeVos made it harder for students to have their debt forgiven. DeVos said the law was too generous to borrowers and too expensive for taxpayers.
Officials in the Biden administration said the DeVos-led formula to cancel student loans in cases of deception or abrupt school closure made it unfairly difficult for borrowers.
“Borrowers deserve a simplified and fair path to relief when they have been harmed by their institution’s misconduct,” said Secretary of Education Miguel Cardona in a statement. “A close review of these claims and the associated evidence showed these borrowers have been harmed and we will grant them a fresh start from their debt.”
Around 44.7 million Americans owe student loans totaling over $1.7 million nationwide and calls for wide-scale student loan cancellation have increased since Biden took office.
In January, Biden signed an executive order extending the payment pause on federal student loans until October because of the pandemic. In February, he urged Congress to include the cancellation of an additional $10,000 of federal student loan debt in pandemic relief measures.