More than 2,500 borrowers in Colorado will have some or all of their student-loan debt forgiven under the Biden administration’s new relief plan, according to a news release from the U.S. Department of Education.
The $19.8 million in debt forgiveness in Colorado is part of a $1.2 billion student loan forgiveness effort under the Saving on a Valuable Education, or SAVE, plan. It’s not yet clear how many Coloradans will see their full debt canceled or just part of an outstanding loan forgiven.
To be eligible for the SAVE plan, borrowers must have made payments toward their student debt for at least 10 years and have originally withdrawn $12,000 or less for college. The plan is based on what the borrower originally took out in student loans, not what a borrower currently owes, the Education Department said.
For every $1,000 borrowed over $12,000, a borrower can receive debt forgiveness after an additional year of payments, officials said.
All SAVE plan borrowers will receive debt forgiveness after 20 or 25 years, depending on whether they have graduate school loans.
People who believe they meet the eligibility requirements are encouraged to sign up for the SAVE plan at StudentAid.gov/SAVE.
President Joe Biden emailed recipients across the country last week notifying them of their loan forgiveness, the Education Department said, and assured them they do not need to take further action to obtain their relief. Loan servicers already have started processing the forgiveness, the news release said. Borrowers should see their loans forgiven in the coming weeks.
The U.S. Department of Education said it will continue to identify and forgive borrowers who qualify and enroll for the SAVE plan on a regular basis.
“The state-by-state SAVE plan debt forgiveness numbers we’re announcing today not only show that President Biden’s leadership is making a real impact on people’s lives in every state — they demonstrate that we won’t ever stop fighting to make higher education more affordable and accessible for more Americans,” Secretary of Education Miguel Cardona said in a news release.
