Student-loan borrowers who weren't in the last round of debt cancellation can still count on relief if they 'did their end of the bargain,' Biden's Education Secretary says

• The Education Department announced $9 billion in debt relief for 125,000 student-loan borrowers this week.
• Sec. Miguel Cardona told Insider that borrowers who did not qualify can still count on future relief.
• The department will continue evaluating which borrowers have completed the required payments.

The top education official doesn't want student-loan borrowers who believe they've made the required payments to lose hope if they have not yet gotten debt relief.

On Wednesday, the Education Department announced $9 billion in relief for 125,000 borrowers who have made the required amount of payments in income-driven repayment plans and Public Service Loan Forgiveness, along with borrowers with total and permanent disability deemed eligible for a loan discharge.

Some of the relief was part of the department's one-time account adjustment for borrowers on income-driven repayment plans and PSLF who have made the required years of payments — 51,000 borrowers on IDR qualified for the latest batch of relief, and in August, 804,000 borrowers benefitted from the first batch.

Education Secretary Miguel Cardona told Insider in an interview that borrowers who did not qualify for the latest round of relief should not lose hope.

"That's really important for us to make sure that those who did their end of the bargain get the relief that they earned," Cardona said.

"They earned this," he added. '"Those public servants who worked for 10 years of public service, many times making less than what they can make in the private sector, who paid their loans, they get the loan forgiveness they deserve. That's really important for us to make sure that we're following the protocols and the policies that were passed in 2007," referring to the year PSLF was signed into law.

According to Federal Student Aid, the Education Department will continue evaluating borrowers' accounts every two months to determine who has met the threshold for relief. However, the procedure to actually get the debt cancellation processed could take time — one servicer, MOHELA, has a notice on its website stating that "if you received an email from Federal Student Aid regarding income-driven repayment forgiveness, please know that we are working to process your forgiveness as soon as possible. Once the forgiveness has been applied, you will be notified."

This relief comes the same week student-loan bills are starting to become due again after an over three-year pause on federal payments. Many borrowers have been encountering a host of challenges as they make this transition, including long hold times with customer service and inaccurate billing statements. Cardona said he recognizes "how difficult it is for so many borrowers" especially after the Supreme Court struck down President Joe Biden's first plan for debt relief.

But he recommended borrowers consider efforts to make the process smoother, like the 12-month "on-ramp" period during missed payments will not be reported to credit agencies, and he said his department is "searching under every rock" to get relief to as many borrowers as possible.

"It's normalized in this country that you go to college, you're expected to pay loans forever," Cardona said. "I want folks to be able to buy homes, invest in their local economy, and not look at higher education as a lifetime of debt."