In a response to a Supreme Court setback, the Biden administration has made significant changes to several debt relief programs. As of Wednesday, it released $5 billion for 53,000 public sector workers under the Public Service Loan Forgiveness program. This program had been hindered by bureaucratic issues for approximately 15 years.
In addition to this, the administration has allocated $2.8 billion to correct historical inaccuracies in payment counts affecting long-term undergraduate loan borrowers. These inaccuracies have been a point of contention for many borrowers who found their repayment progress incorrectly calculated.
The administration has also made adjustments to the SAVE plan, an income-driven initiative. This plan now modifies the monthly payments for approximately 30 million borrowers, taking into account their income and family size. This reform is expected to ease the financial burden on these borrowers, making student loan repayments more manageable.
Additionally, funds have been set aside for disabled borrowers. While the exact amount has not been disclosed, this move acknowledges the financial challenges faced by this group and aims to provide them with necessary support.
Furthermore, $37 million was distributed to 1,200 students who were deceived by false promises of high-paying jobs from the University of Phoenix. The Federal Trade Commission reported these fraudulent claims, leading to this monetary compensation for affected students.
These reforms signal a shift in federal student loan policy under the Biden administration. By addressing longstanding issues such as bureaucratic red tape and payment inaccuracies, these changes aim to provide much-needed relief to millions of student loan borrowers across the country.
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