Biden unveils another plan to wipe up to $20,000 in student loan debt for up 25 million borrowers... as his bill for forgiveness reaches $153 billion

The Biden administration officially unveiled new rules it plans to use to wipe out millions in debt for student loan borrowers by tackling ballooning interest.

President Biden first announced his latest proposals to cancel student loan debt during a visit to Madison, WI more than a week ago after his original plan was blocked by the Supreme Court.

In total, the administration believes his combined efforts could cut debt for more than 30 million borrowers including the 4.3 million who have already seen their debt forgiven. 

The new rules which will be formally published on Wednesday. The public will then have 30 days to comment on the proposals. 

The Education Department will then finalize the rules to start canceling debt this fall.

President Biden at an event to address student loan debt in Madison, WI. The Education Department officially released the first set of draft rules under his new plan on Tuesday

It comes as Republicans have accused President Biden of attempting to 'buy votes' as he runs for reelection. 

18 Republican-led states have already sued over another plan the president released, the SAVE plan.

The administration has wiped $153 billion in student loan debt since Biden took office and expects to new rules to cancel billions more.

The Penn Wharton Business Model estimates the new rules along with the president's recent SAVE plan would cost about $559 billion over a decade. 

Protesters gathered outside the Supreme Court as the court blocked President Biden's previous student loan relief plan last June. Biden has already canceled $153 billion in student loan debt despite the court blocking the first effort

The first of the drafted rules focuses on canceling interest for borrowers who have more debt now than when they originally took out loans due to growing interest. 

It would allow the Education Department to automatically cancel up to $20,000 in debt for borrowers on the amount they currently owe that exceeds what they owed when they started repaying loans. 

It would apply to all types of student loans held by the Education Department including parent loans, consolidated loans and ones in default. 

Another rule would allow the Education Department to cancel the full amount of debt borrowers saw their balances grow by after enrolling in Income-Driven Repayment plans.

To qualify, borrowers would have to have an annual income of $120,000 or less if single and $240,000 or less if married.

The Biden administration estimates 25 million borrowers now owe more than they originally borrowed due to federal student loan interest. The new rules would wipe out the entire increase in balances of 23 million borrowers.

The Education Department also released a draft of the rule dealing with canceling debt for borrowers who have been making payments for 20 or more years.

It applies to undergraduates who started repaying loans on or before July 1, 2005.

Graduate school borrowers can see debt canceled after repaying loans for 25 years, or since July 1, 2000.

The administration estimates the one-time move would impact 2.6 million borrowers who have outstanding deb on old loans still in repayment. But officials are asking the public for feedback on ways to help borrowers who are close but don't quite meet the timeline qualifications.

Other rules that advanced include ones dealing with canceling debt for borrowers who are eligible under other programs but have not yet applied due to paperwork requirements, bad advice or other obstacles.  

The Education Department will publish a second rule focused on providing relief for borrowers experiencing hardship in the coming months.

The steps this week are ones that move the Biden administration closer to canceling debt for millions.

Critics of President Biden have blasted the president's efforts to cancel debt calling it unfair to Americans who did not take out loans, go to college or already paid back debt. 

Republicans have slammed the effort as a shift of the debt rather than eliminating it as the efforts could help drive up the national debt was less money coming in.

But some advocates praised the move Tuesday. The Center for Responsible Lending has advocated for eliminating accrued interest. 

The group said the rules on Tuesday 'ensure a higher education system that is fairer and more accessible to all.'