WASHINGTON — A program aimed at forgiving student loans for public service workers has now provided financial relief to over 1 million individuals, a significant increase from only 7,000 approvals prior to its changes by the Biden administration two years ago.
President Joe Biden marked this achievement on Thursday, highlighting his administration’s commitment to America’s essential workers, such as teachers, firefighters, and nurses. He celebrated this progress even as other aspects of his broader student loan initiatives remain stalled due to ongoing legal challenges raised by Republican-led states.
“For too long, the government did not uphold its obligations,” Biden stated. “We made a promise to rectify the situation, and as a result of our efforts, more than 1 million public service employees have received the financial relief they rightfully deserve.”
The Public Service Loan Forgiveness (PSLF) program was established in 2007, pledging that graduates working in government or nonprofit roles for ten years would have their remaining federal student loans forgiven. However, beginning in 2017, the majority of applicants faced rejection due to a set of complex and often obscure eligibility guidelines.
A report from the Government Accountability Office in 2018 revealed that 99% of applicants were denied, frequently because they were not enrolled in the appropriate loan repayment plans or had their payments paused due to deferment or forbearance. Such periods were not considered as part of the decade of required public service.
The GAO criticized the Education Department for its failure to clarify these confusing rules.
The program went through considerable legal and political turmoil, with Democratic lawmakers urging the Trump administration to amend the restrictions in order to honor the original purpose of the program. Betsy DeVos, then Education Secretary, maintained that she was adhering to the legislative guidelines as established.
Characterizing the program as “broken,” the Biden administration in 2021 implemented a temporary waiver that allowed borrowers to receive credit for past deferment or forbearance periods among other adjustments. The following year, an update to the rules expanded eligibility permanently.
Since these changes, many borrowers have finally qualified for loan forgiveness as they complete their ten years of service. On Thursday alone, 60,000 more individuals reached that milestone, bringing the total over the 1 million mark. When Biden assumed office, a mere 7,000 borrowers had previously received relief across the four preceding years.
Overall, the program has forgiven about $74 billion in student loans for public service employees.
“I want to convey a message to college students throughout America—that choosing a career in public service is not only commendable but also a dependable route to achieving debt freedom within ten years,” stated Education Secretary Miguel Cardona.
In light of ongoing legal pushbacks against Biden’s overall student loan plans, his administration is increasingly focusing on the substantial loan cancellations facilitated through existing programs.
The administration now reports it has canceled approximately $175 billion for around 5 million borrowers. The PSLF program constitutes the largest portion of this relief, while various other programs have seen loans forgiven through income-driven repayment plans and a 1994 rule intended to aid students defrauded by their educational institutions.
Biden ran on a platform promising extensive student loan cancellation, but last year, the Supreme Court blocked his initiative to forgive up to $20,000 for 40 million Americans. Following this setback, Biden instructed the Education Department to pursue alternative legal avenues. However, a judge in Missouri has temporarily put a hold on this revised plan after several Republican states challenged it.