Credit Card Debt & Loans

Are You Eligible? Biden’s Plan for Student Loan Forgiveness (Update)

Are You Eligible? Biden’s Plan for Student Loan Forgiveness (Update)
Reviewed by Nima Vahdat
Updated September 15, 2023

President Biden’s plan for student loan forgiveness continues to evolve as we move closer to an election year. 

The weight of student loan debt is an overwhelming burden for millions of Americans. A burden you may now be able to lighten. If you’re wrestling with student loan debt, you’ve likely been paying attention to President Biden’s new Saving on a Valuable Education (SAVE) plan. 


  • The SAVE plan aims to significantly reform income-driven repayment (IDR) plans, making them more generous and accessible than ever before.
  • There are several key qualifications you need to meet where eligibility hinges on income, family size, and the type of loan you have. 
  • The timeline for loan forgiveness varies depending on your loan balance and repayment history. 

You may be wondering whether your loans are in line for forgiveness under the SAVE plan. Below, you’ll discover everything you need to know about the program’s scope, implementation, and most importantly, whether or not your loans are in line for forgiveness. 

What is the SAVE Plan?

The SAVE plan aims to significantly reform income-driven repayment (IDR) plans, making them more generous and accessible than ever before. Specifically, this plan seeks to reduce monthly payments, provide a pathway to quicker loan forgiveness, and expand zero-payment options for low-income earners. 

Are My Loans in Line for Forgiveness?

Let’s break down the key qualifications you need to meet. Under the new program, eligibility hinges on income, family size, and the type of loan you have. The program primarily focuses on federal student loans. 

Specific qualifications may vary, but generally, the less you earn and the bigger your household, the more likely you are to benefit. It’s also worth noting that the forgiveness is designed to target both low- and middle-income earners.

  • Income-Driven Repayments — The SAVE plan calculates your monthly payments based on your income and family size, not the loan balance. If you’re already on an IDR plan, this is designed to be more beneficial.
  • Reduced Payments — If you have undergraduate loans, your payments will be slashed from 10% to 5% of your discretionary income. If you also have graduate loans, the payment will be a weighted average between 5% and 10% based on the original principal amounts.
  • Zero Payments for Low Earners — Under the SAVE plan, if you make around $15 per hour, your monthly payments could be zero. The Department of Education estimates that more than 1 million additional low-income borrowers will qualify for a $0 monthly payment.
  • No Balance Growth — If you make the required payments, your loan balance will not grow due to unpaid interest, a feature not commonly found in existing IDR plans.
  • Early Forgiveness for Small Balances — Loans with original principal balances of $12,000 or less will receive forgiveness after 120 payments, roughly 10 years. For each additional $1,000 borrowed above that level, 12 more payments will be added, up to a maximum of 20 or 25 years.
  • Community College and Public Service Workers — This plan is particularly beneficial for low- and middle-income borrowers, those who attended community colleges, and those who work in public service sectors.
  • Automatic Enrollment — If you’re already on the Revised Pay-As-You-Earn (REPAYE) plan, you will be automatically transferred to the SAVE plan, with adjustments made to your payments.

Can I Apply Now?

Yes, you can apply for the program immediately. The application process has been streamlined to make it user-friendly. Simply visit and fill out the required forms. You’ll need to provide documentation of your income, which can be easily accessed through IRS data retrieval tools.

When Will My Loans Be Forgiven?

The timeline for loan forgiveness varies depending on your loan balance and repayment history. Borrowers with loan balances of $12,000 or less could see forgiveness after 120 payments, equivalent to 10 years. For higher loan amounts, expect additional time—roughly one more year for every extra $1,000 borrowed. So, if your loan is $14,000, you’re looking at 12 years for forgiveness.

The SAVE plan is retroactive, meaning payments made before its 2024 implementation and going forward will count toward these maximum forgiveness timeframes. For those with large loans and higher incomes, the timeline will extend accordingly. Stay tuned for further guidance from the Department of Education for a detailed timeline tailored to your specific loan situation.

Biden’s Backup Plan for Student Loan Forgiveness

The Biden administration has put forth additional loan relief options like income-driven repayment plans and public service loan forgiveness. These can be fallback options if you don’t qualify for the new program or wish to explore other avenues. Notably, Biden’s “SAVE” plan offers a more generous income-driven repayment model than its predecessors, making it an attractive secondary option.

Education Department’s Timeline and Details for Rulemaking

The Department of Education has rolled out a timeline and additional clarifications to eliminate any ambiguities in the new program. While the primary structures are set, be aware that adjustments may be made in the future based on feedback and the program’s initial success. This means keeping yourself updated on any announcements or modifications can be beneficial.

When Can I Start Benefiting from Biden’s New Program?

The program is not a future promise; it’s already in action. With its official announcement, borrowers can start applying and benefitting immediately. While some aspects of the program will evolve, don’t wait for future iterations—take advantage of the relief currently being offered. 

Why You Should Keep Making Payments

While the program promises significant relief, the Department of Education urges borrowers to continue making payments if possible. This recommendation is particularly relevant as the details of the program are fully implemented. Keeping up with payments can prevent unwanted interest accumulation and puts you in a good position when the relief officially kicks in. 

If you’re grappling with monthly payments and your debt has reached unmanageable levels, you may want to consider working with a company like Americor who can assist you with debt settlement negotiations to develop a payment plan that aligns with your budget.


President Biden’s Student Loan Forgiveness Program is a monumental step toward alleviating the national student debt crisis. Offering a range of options for borrowers from various economic backgrounds, the program is designed to make education an avenue for opportunity, not a path to financial hardship. Understanding the program’s ins and outs can put you on a quicker road to financial freedom.

If you’re bearing the burden of student loans, and depending on how much debt you owe in total, you may want to consider seeking debt relief

Americor has provided over $2 billion in debt relief to over 200,000 clients, and could help provide you with the debt relief you need. 

For more information on Americor’s debt relief services, contact us today to see how we can help you get on the fast-track to becoming completely debt-free!