The U.S. Department of Education will forgive $39 billion in student debt by updating a technical requirement under a long-existing program.
The change, announced Friday, will help more than 804,000 borrowers. It comes as the Biden administration pursues alternatives to a $400 billion student loan forgiveness plan that the Supreme Court struck down in June.
President Joe Biden called the latest move part of his administration's commitment to "bring the promise of college to every American."
The new plan counts more payments toward a forgiveness program that kicks in when struggling borrowers have made the equivalent of either 20 or 25 years worth of payments.
"For far too long, borrowers fell through the cracks of a broken system that failed to keep accurate track of their progress towards forgiveness," Education Secretary Miguel Cardona said in a statement.
Income-driven plans allow struggling borrowers to make smaller payments and are different from Biden's broader attempts to alleviate student debt, which is well in excess of $1 trillion.
