Important Progress for Student Loan Borrowers

Reposting from NCLC, July 18, 2023: The Department of Education has begun the process of automatically discharging $39 billion in federal student loans for more than 800,000 borrowers who have been in repayment for over two decades and are eligible for discharge of their remaining balance under the income-driven repayment program, but hadn’t yet received relief due to servicing and other system failures.

Borrowers will be eligible for this relief if they have accumulated the equivalent of 20 or 25 years (depending on their loan type) of qualifying months of student loan payments under IDR plans. The Department began notifying eligible borrowers at the end of last week that their outstanding student loan balances would be canceled and discharges are set to begin 30 days after notification.

NCLC and our allies have, for years, been calling attention to the decades-old problems with the Department’s IDR program that have failed to credit borrowers’ time in repayment and created often insurmountable hurdles for those with the oldest debts to secure loan forgiveness and a pathway to a debt-free future. We applaud the Department for adopting these long-overdue fixes – ones that NCLC and our allies have been fighting for.

Now, the work must continue. Roughly 3 million more borrowers – who have been in debt for the same amount of time as those who received relief and may have fallen into default – have encountered many of the same problems and are still waiting for their promised relief. We will continue to work with the Administration to ensure these borrowers are not left behind.

Visit NCLC’s new Student Loan Borrower Assistance project website to learn even more about the fixes to the IDR program.
Thank you for standing with us in this critical work.

Abby Shafroth
Co-Director of Advocacy
Director, NCLC Student Loan Borrower Assistance Project.

Student loan debt affects everyone, no matter their age.  Ninety percent of student loans are federal monies, which taxpayers money.  Student loans have been abused and misused by almost everyone involved.  Not just the borrowers, but also the colleges and government assistance programs.  The colleges see student loans as a huge money maker.  Many colleges forget their obligation to provide a quality education for the money they are paid.  Some borrowers see the money as “free” becuase it is so easy to obtain.  They don’t realize it is a contract with the lender (funded by you and me, the taxpayer) that must be repaid.