MINNEAPOLIS — More than 13,600 Minnesotans who borrowed money for federal student loans have been approved for forgiveness as part of the Biden administration's new plan, which was announced last week.
On Tuesday, The Minnesota Department of Education released a state-by-state breakdown of the number of borrowers who were eligible. In Minnesota, 13,610 people will receive more than $645 million in income-driven repayment (IDR) forgiveness in the coming weeks, according to the Education Department.
The administration said last week that debt forgiveness is being offered to correct errors from previous administrations. Under the Higher Education Act and Dept. of Ed. regulations, they argue, a borrower is equivalent for forgiveness after around 240 or 300 payments — the equivalent of 20 to 25 years on a standard repayment plan.
“For far too long, borrowers fell through the cracks of a broken system that failed to keep accurate track of their progress towards forgiveness,” said U.S. Secretary of Education Miguel Cardona in a written statement Friday. “By fixing past administrative failures, we are ensuring everyone gets the forgiveness they deserve, just as we have done for public servants, students who were cheated by their colleges, and borrowers with permanent disabilities, including veterans."
President Joe Biden released a statement last week touting the plan, while also promising more changes, including income-driven repayment plans.
"My Administration has worked hard to secure the largest increases to Pell Grants in a decade, fixed broken loan programs such as Public Service Loan Forgiveness, and created a new income-driven repayment plan that will cut undergraduate loan payments in half and bring monthly payments to zero for low-income borrowers," his statement reads, in part. "And, when the Supreme Court made the wrong decision, I immediately announced a new plan to open an alternative path to relief for as many borrowers as possible, as soon as possible."
The Supreme Court ruled last month that Biden's administration overstepped its authority when trying to implement a plan that would have forgiven between $10,000 and $20,000 of federal student debt to anyone with an annual income of less than $125,000 or households of less than $250,000.
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