Texans will get the biggest share of President Joe Biden’s newest effort in canceling billions of dollars in student debt, a sign that more borrowers in the state have struggled to pay off longstanding loans.

Residents in the Lone Star State that have signed up for a new income-driven repayment program known as SAVE will receive $116.6 million of the $1.2 billion awarded, according to data released by the White House. California, which has 8.5 million more residents than Texas, will see $114.8 million in relief.

The forgiveness is the latest incremental effort by the Biden administration to cancel student debt after the Supreme Court blocked its one-time forgiveness plan last June. The nearly $138 billion the administration has canceled so far is less than half of the $400 billion the Congressional Budget Office said would be wiped out under the broad-based plan, and has primarily impacted a narrow group of borrowers who meet certain qualifications.

The Biden administration announced on Feb. 21 that some 150,000 borrowers will receive a cumulative $1.2 billion in student-debt forgiveness under the income-driven repayment program known as SAVE. Borrowers enrolled in the plan who initially took out $12,000 or less in federal loans and have made at least 10 years’ worth of payments qualify for their remaining balance to be forgiven.

Undergraduate students borrowed an average $6,600 in federal loans in the 2021-2022 school year, according to National Center for Education Statistics data. Borrowers with less education are more likely to be behind or default on their student loan payments, so someone who took out two years’ worth of loans, for example, but didn’t finish school could end up saddled with debt without the better salary that a higher education promises.

A monthly payment on a $12,000 student debt balance would be around $150, said Betsy Mayotte, the president of The Institute of Student Loan Advisors. An inability to pay that bill each month — and particularly in a way that pays off that balance within ten years — may be a sign of financial hardship.

“Most people assume that it’s the six-figure debt people are most likely to default on, when in fact it’s the borrowers who borrowed very little that have a higher risk of default,” Mayotte said.

There are about 7.5 million borrowers enrolled in the SAVE plan, according to the US Department of Education, of whom 4.3 million pay $0 each month because they fall below the income threshold for repayment. In July 2024, monthly payments will be reduced from 10% of a borrower’s discretionary income to 5%.

This article was provided by Bloomberg News.