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$2.4 Billion In Student Loan Forgiveness For 38,000 Borrowers Is In The Pipeline, Says Education Department – Forbes

Education Secretary Miguel Cardona speaks before the Senate Health, Education, Labor and Pensions … [+] committee during his confirmation hearing on Capitol Hill in Washington, DC, on February 3, 2021. (Photo by Susan Walsh / POOL / AFP) (Photo by SUSAN WALSH/POOL/AFP via Getty Images)

POOL/AFP via Getty Images

The Department of Education provided updated statistics on Friday for borrowers who have been approved for student loan forgiveness under a new expanded program the Biden administration announced in October.

“As of today, we’ve identified 38,000 borrowers who will receive $2.4b in loan forgiveness,” said Education Secretary Miguel Cardona in a tweet on Friday, “with more on the way.”

Student Loan Forgiveness Under The Limited PSLF Waiver

The billions in student loan relief are being provided to borrowers under the “Limited PSLF Waiver” — a temporary expansion of Public Service Loan Forgiveness (PSLF), a program created by Congress in 2007 for student loan borrowers who commit to working full-time for public or nonprofit organizations. Plagued by complex rules and poor oversight for years, PSLF has long suffered from high denial rates and broad criticism. The new waiver program, first announced by Education Department officials on October 6, relaxes key PSLF program requirements by temporarily allowing more categories of federal student loans and repayment plans to qualify.

The Department’s latest statistics exceeded earlier projections of initial relief, and even more borrowers are expected to benefit from student loan forgiveness under the PSLF waiver program in the coming months. Borrowers with FFEL-program federal student loans and federal Perkins loans had been shut out of the PSLF program for years. But by consolidating their loans through the federal Direct consolidation program and submitting the required forms to certify their employment, these borrowers may be able to get past payments counted under the Limited PSLF Waiver, provided they act before October 31, 2022. The Department has established a website to provide borrowers with guidance.

Other Potential Changes To Public Service Loan Forgiveness May Be In The Works

The Biden administration enacted the Limited PSLF Waiver using emergency executive authority. As a result, the relief is only available for a limited time — until October 31, 2022. But the administration is also considering other, more permanent changes to the PSLF program.

Last week, the Department held a negotiated rulemaking session on a proposed overhaul of the regulations governing PSLF. The administration is proposing a number of improvements designed to streamline the program after the waiver expires, including automating employment certifications and cutting out bureaucratic red tape and application forms, and clarifying the definition of a “qualifying payment” to include payments that are split into multiple installments or paid early or ahead. The administration is also considering allowing some periods of deferment and forbearance to count, as well as payments made prior to consolidation. The Education Department is also hoping to create a formal appeal or reconsideration process for denied applications.

Advocates for student loan borrowers …….

Source: https://www.forbes.com/sites/adamminsky/2021/12/17/24-billion-in-student-loan-forgiveness-for-38000-borrowers-is-in-the-pipeline-says-education-department/

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