President Joe Biden's administration will automatically cancel $39 billion in student debt for more than 800,000 borrowers, CNBC reported Friday.
"For far too long, borrowers fell through the cracks of a broken system that failed to keep accurate track of their progress towards forgiveness," CNBC quoted U.S. Secretary of Education Miguel Cardona as saying.
The announcement comes after the Supreme Court on June 30 struck down President Joe Biden’s student loan forgiveness plan, which would have delivered relief to about 37 million people.
"At the start of this administration, millions of borrowers had earned loan forgiveness but never received it. That’s unacceptable," USA Today quotes Education Department Under Secretary James Kvaal as saying. "Today we are holding up the bargain we offered borrowers who have completed decades of repayment."
The borrowers involved in these plans for forgiveness include those with Direct Loans or Federal Family Education Loans held by the department, including Parent PLUS loans.
Eligible borrowers will be notified directly, and will be able to opt out of the debt forgiveness if they they have concerns about tax implications or other issues.