Biden rushes to enact new student loan forgiveness plan before November

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Elizabeth Frantz/Reuters

President Joe Biden during a visit to Raleigh, North Carolina, on March 26, 2024.


Biden administration officials on Monday revealed details of a new plan to forgive student loan debt, suggesting that millions of Americans could begin to see debt relief as soon as this fall.

The new set of proposals, which CNN reported on Friday, have not yet been finalized. It is President Joe Biden’s second attempt to implement broad student loan forgiveness. His first plan was overturned by the Supreme Court last summer.

The new policies, combined with the tighter actions The measure already taken by the Biden administration to cancel student debt would benefit more than 30 million Americans, according to a fact sheet provided by the White House.

That means nearly 70% of all federal student loan borrowers would see their debt reduced or canceled entirely due to Biden’s policies.

But first, the plans must be finalized – a process that could take months – and must withstand any potential legal challenges.

Biden’s new student loan forgiveness proposals could spark another fight with Republicans. Several conservative-led states and groups sued the Biden administration over the first student forgiveness program, arguing that the executive branch had overstepped its authority.

“President Biden will use every tool available to cancel student loan debt for as many borrowers as possible, no matter how many times Republican elected officials try to stand in his way,” White House press secretary said on Sunday. Karine Jean-Pierre, in a call with reporters.

After the Supreme Court rejected Biden’s first plan last year, the president promised to pursue another path to achieving student loan debt relief. Since then, the Department of Education has been conducting a lengthy, formal process, known as negotiated rulemaking, to develop a new student loan forgiveness program.

It’s a different process than the Biden administration used in its first attempt to provide blanket loan forgiveness, which would have canceled up to $20,000 in student loan debt for borrowers making $125,000 or less a year.

The new plans target specific groups of borrowers. If implemented as proposed, borrowers could see relief if they fall into any of the following categories:

  • Those who have balances greater than what they originally borrowed due to interest.
  • Those who already qualify for student loan forgiveness under existing programs but have not applied.
  • Those that began amortization at least 20 years ago.
  • Those who enrolled in “low financial value” programs, which left students in debt but without good job prospects.
  • Those who are experiencing financial difficulties.

The new proposals released Monday must still go through a public comment period. Then, after reviewing those comments, the Department of Education will publish a final version of the rule.

Generally, if a final rule is published after going through negotiated rulemaking before November 1, it can go into effect on July 1, 2025.

But some exceptions are allowed and parts of the rule could be implemented early. For example, the Biden administration implemented parts of the SAVE Plan – an income-based student loan repayment plan – last year, while other parts of the plan won’t take effect until July.

In the case of new student loan forgiveness proposals, the Department of Education could begin writing off accrued interest for qualified borrowers this fall, according to the White House.

Even though the Supreme Court overturned Biden’s broad student loan forgiveness, his administration has still canceled more student loan debt than under any other president, primarily using existing programs. His administration has made things easier for certain groups of borrowers – such as public sector workers, including teachers; disabled borrowers; and people who were defrauded by for-profit colleges, to qualify for student loan debt forgiveness.

So far, 4 million people have had their federal student debt canceled under the Biden administration, for a total of $146 billion.

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