A student loan administrator said Monday that the U.S. Department of Education (DOE) has agreed to pay $30,000 to students who paid their loans for good, but that some borrowers still need help.
The payment was announced by Education Secretary Betsy DeVos at a news conference in Washington, D.C.
The department’s loan forgiveness program allows borrowers who are in arrears on their federal student loans to get forgiven up to the interest they owe on their debt, which typically ranges from 3% to 7.5%.
But borrowers who can’t afford the interest on their loans may have to make a down payment or pay interest on other debt in the form of a federal income tax.
The program is meant to encourage borrowers to pay their student loans off as quickly as possible.
But the department has also been slow to enforce its policy.
The department initially started the program in 2017 and it has been credited with $6 billion in relief, according to the Wall Street Journal.
However, it was unclear what percentage of borrowers who qualify would qualify for the forgiveness.
A spokesperson for the department did not immediately respond to a request for comment.
The Trump administration is proposing to eliminate the loan forgiveness portion of the federal student loan program and instead offer an additional repayment plan.
Under the plan, borrowers who owe $4,000 or more on their student loan would get a loan forgiveness payment of $2,000 for the first 30 days.
Those who owe more than $4.5,000 on their loan would be required to make the same payment for the rest of their loan term.
If borrowers who did not make their payments could not afford the forgiveness, they would be offered the option of refinancing the loan, with a downpayment of $500.
If the borrower did not meet the downpayment requirement, the federal government would pay a portion of their loans interest.
The new repayment plan would require borrowers to make payments of $10,000 in a month and would allow them to defer payments if they can’t pay off their loans.
It would also provide borrowers with a grace period of up to five years from when they started repaying.
Under existing policy, a borrower must make their student debt payments each month.
The DOE will also provide $2 million in loans forgiveness grants to borrowers who do not make a payment on their outstanding loans.
The loan forgiveness payments are designed to help borrowers repay loans on time, according the department.
The loan forgiveness grants will be used for loans that borrowers are unable to repay.