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    • Biden’s student loan forgiveness benefits 55,000 civil servants
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    Biden’s student loan forgiveness benefits 55,000 civil servants

    Pabio Posted on

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    About 55,000 public employees across the country — people who work for the federal, state, local, tribal or nonprofit government — could see their student debt canceled thanks to a new round of federal loan relief.

    The Biden administration on Friday announced $4.28 billion in relief under the Public Service Loan Forgiveness (PLSF) program, which allows these employees to forgive their remaining debts after making at least 120 payments to repay them .

    The PSLF program was created by bipartisan legislation in 2007, but due to processing errors and poor design, it has failed to serve the thousands of public employees whose services it was supposed to recognize, even rejecting 99% of candidates in one year.

    During its first year of implementation in 2018, only 55 borrowers out of more than 19,000 had their loans canceled, and only 890,000 were approved out of more than 1.1 million applicants, the Government Accountability Office reported in 2018.

    The government subsequently implemented several recommendations made by the GAO to correct the program, but it remained ineffective relative to the historic impact it was intended to have. His critics say he has failed to incentivize public workers with student loans to stay in low-paying jobs.

    In 2022, a one-time pandemic waiver allowed anyone working full-time in an eligible public service job since October 2007 to receive loan forgiveness, including people who were not previously there eligible. The program was created as part of an effort to “fix” the PSLF program as part of the Biden administration’s commitment to student debt relief.

    More: New Jersey residents in these occupations can apply for student loan forgiveness

    Fixing the Public Service Loan Forgiveness Program

    The new funding provides $180 billion in total student debt relief to nearly five million borrowers, the department said.

    “Four years ago, the Biden-Harris administration committed to America’s teachers, service members, nurses, first responders and other public servants to fix the Public Service Loan Forgiveness program, and I “I’m proud to say that we delivered,” said U.S. Education Secretary Miguel Cardona.

    The relief announced Friday covers both borrowers who benefited from the temporary PSLF waiver that ended in October 2022, as well as regulatory improvements made to the program under the Biden administration, the Department of Education said .

    The PSLF program is now managed entirely by the Department of Education through StudentAid.gov, it says, rather than by a single loan servicer. This makes it easier for borrowers to track their progress toward forgiveness, he said Friday.

    Approximately 31,000 New Jersey residents were enrolled in the PSLF program in 2022. More than 2,500 state residents had their debts forgiven in the amount of $167 million, an average forgiveness of more than $65,000 per person that year, Murphy said at a 2022 event to raise awareness of the limits of the pandemic era. PSLF Waiver at College of New Jersey.

    The state-run New Jersey Higher Education Student Aid Authority declined to comment on the federally run program. The Biden administration did not immediately respond to request for comment.

    Pabio
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