New Biden student-debt effort would reduce loan amounts for 6,940 Arkansas borrowers

LITTLE ROCK, Ark. – A new effort by President Joe Biden to reduce student debt could lead to nearly 7,000 Arkansans see a reduction in their education loans.

Data released Tuesday by the U.S. Department of Education breaks down the per-state numbers for student loan borrowers affected by the latest Biden administration plan for income-driven repayment (IDR) forgiveness.

Arkansas has 6,940 borrowers with $342.6 million in debt affected by the loan forgiveness plan, according to DOE figures. This group is part of the 804,000 national borrowers with $38.9 billion in debt being discharged by the plan.

The DOE began noticing impacted borrowers of their relief eligibility last week, officials said.

This forgiveness plan occurred after the Supreme Court ruled against an earlier Biden administration forgiveness plan in June. The decision ended what would have been the cancellation of $430 billion of loans.

Student loan forgiveness had been part of the administration’s policy agenda.

“I have long said that college should be a ticket to the middle class - not a burden that weighs down on families for decades,” Biden said in a release.

The administration said it had continued its work in student loan forgiveness in order to address what it called historical failures in the administration of the federal student loan program in which qualifying payments made under income-driven repayment plans that should have moved borrowers closer to forgiveness were not accurately accounted for.

A recent report from Georgetown University showed higher education costs have increased 169% since 1980, while income for young workers has increased 19%. The higher cost coupled with interest capitalization has placed some borrowers in a situation where their loan balance stays high.

For more information on the administration’s IDR plans, head to StudentAid.gov/IDR.

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