President Joe Biden may not have fully delivered on his ambitious promise of broad student loan forgiveness, yet his administration has still made significant strides, erasing billions of dollars in student debt. This achievement stands as a testament to his commitment to easing the financial burdens faced by countless borrowers across the nation.
In a final push just days before leaving the White House, Biden announced three targeted rounds of student debt relief, revealing that an additional 400,000 borrowers would benefit from $10 billion in debt cancellation. This decisive action underscores his ongoing dedication to addressing the student loan crisis in America.
Biden highlighted in a statement that these recent measures have elevated the total number of borrowers receiving student loan forgiveness under his administration to over 5 million, showcasing the scale of relief provided during his tenure.
“I’m proud to say we have forgiven more student loan debt than any other administration in history,” Biden declared, emphasizing the unprecedented nature of the relief efforts initiated during his presidency.
In total, the Education Department has successfully discharged approximately $190 billion in student debt through 33 targeted relief measures since Biden took office, as reported by the agency on Thursday, highlighting the extensive impact of these initiatives on borrowers.
However, Republicans have largely criticized this final wave of forgiveness efforts. Education and Workforce Committee Chairman Tim Walberg, R-Mi., labeled it a “swan song” that disregards prior court rulings related to student loan forgiveness.
“It is shameful that, in its final days, the Biden-Harris administration is doubling down on efforts to push as much forgiveness as possible through the door,” he stated, adding that these actions are once again neglecting the rule of law.
Understanding the Beneficiaries of Biden’s Last Student Debt Relief Initiatives
Biden’s concluding relief measures are primarily designed to assist public service workers, borrowers who were misled by their educational institutions, and those who are permanently disabled. These specific groups have long qualified for student debt relief under established programs administered by the Education Department.
While they were not part of Biden’s broader and unsuccessful attempts at sweeping forgiveness, the Biden administration made several key changes to streamline the process, making it easier for borrowers to obtain the relief they deserve through these existing programs.
- Approximately 350,000 borrowers approved for Borrower Defense forgiveness: Hundreds of thousands of borrowers who attended for-profit institutions found to have engaged in deceptive practices, such as Ashford University and the Center for Excellence in Higher Education, will have their student loans automatically forgiven, providing much-needed relief.
- 61,000 borrowers to receive Total and Permanent Disability Discharge: Thanks to the Education Department’s recent capability to automatically retrieve data from the Social Security Administration and the Department of Veterans Affairs, this group of disabled borrowers is set to benefit from automatic loan forgiveness.
- 6,100 qualify for Public Service Loan Forgiveness (PSLF): Through the PSLF program, this latest group of dedicated public-sector employees, including doctors, nurses, teachers, and social workers, will see their remaining loan balances forgiven after a decade of service and consistent loan payments.
- Over 4,500 to receive relief via Income-Based Repayment (IBR): After years of making payments under the IBR plan, which adjusts monthly payments based on earnings, 4,550 borrowers are finally having their remaining balances discharged, highlighting the effectiveness of existing relief programs.
The Education Department confirmed that these discharge measures cannot be reversed by the incoming Trump administration, ensuring that the relief provided remains intact for the beneficiaries.
“This is a final agency determination,” an official stated during a recent press call, reaffirming the commitment to uphold these relief measures.
Exploring the Landscape of Student Loan Forgiveness Under Biden’s Administration
When Biden assumed office in 2021, he entered with ambitious plans for student loan forgiveness, having campaigned on a commitment to cancel at least $10,000 in student debt per borrower. However, the broader relief initiatives did not materialize as intended, despite considerable efforts to navigate the complexities of the student loan system.
In 2022, he introduced his first substantial forgiveness plan, aiming to cancel up to $20,000 per borrower, a measure projected to benefit over 40 million federal student loan borrowers. Unfortunately, this plan was ultimately halted when the U.S. Supreme Court ruled that the president lacked the legal authority to enact such widespread debt cancellation.
In response to the legal setbacks, the Biden administration revised its strategy, developing a more focused forgiveness plan that went through an official rulemaking process. This plan was specifically designed to provide relief to borrowers facing financial hardship or those who had been repaying their loans for extended periods. However, this too encountered significant legal hurdles.
As the presidential election approached, the administration further refined the plan, creating what could be considered a “Plan C” that aligned more closely with the courts’ previous rulings, aiming to salvage some form of relief amidst ongoing challenges.
In light of Vice President Kamala Harris’s loss to President-elect Donald Trump, Biden ultimately decided to abandon his broader debt forgiveness efforts, officially withdrawing the proposed measures.
Throughout these legal battles, Biden enacted various piecemeal adjustments to the student loan repayment system, enhancing the application and approval processes for existing relief programs overseen by the Department of Education.
Additionally, he introduced a new income-driven repayment plan called SAVE, which stands for Saving on a Value Education. Although this program faced its own legal challenges, it succeeded in forgiving approximately $1 million in debt for eligible borrowers before its setback.
In tandem with these initiatives, Biden leveraged several long-established forgiveness programs, such as PSLF and others, to extend relief to millions of borrowers, showcasing his commitment to addressing the student loan crisis.
Here’s a summary of the various programs utilized by Biden to facilitate student loan forgiveness amidst the challenges faced by his administration:
- Income-Driven Repayment (IDR) plans: $57.1 billion for 1.45 million borrowers
- PSLF: $78.5 billion for over 1 million borrowers
- Disability discharge: $18.7 billion for over 630,000 borrowers
- Borrower Defense: $34.5 billion for nearly 2 million borrowers
Insights on the Future of Student Loan Borrowers Under Trump’s Administration
While Trump has remained relatively silent on the issue of student loan forgiveness, borrowers should temper their expectations for future relief initiatives.
His cabinet and advisors, including influential figures from Project 2025 and the America First Policy Institute, have expressed strong opposition to student loan forgiveness, indicating a likely shift away from the relief policies established during the Biden administration.
Moreover, Trump has indicated a desire to dismantle the Education Department as one of his initial actions in office, a move that would require Congressional approval. If such a dismantling were to occur, the fate of the estimated $1.5 trillion in federal student loans managed by the department remains uncertain.
One potential outcome, as discussed in Project 2025, is the possibility of transferring these loans to the U.S. Department of the Treasury, rather than allowing for any unintentional forgiveness, which has been a source of speculation among borrowers.
Michael Itzkowitz, an education policy consultant and founder of HEA Group, recently shared insights with Money, suggesting that borrowers should anticipate a continuation of Trump’s first-term policies: a likely reduction of the relief initiatives established during the Obama and Biden administrations.
“It’s likely that the incoming administration will abandon forgiveness programs,” he stated, emphasizing the potential implications for borrowers seeking relief in the future.
Discover More Financial Insights from Money:
New Federal Rule Removes All Medical Debt From Credit Reports
Here’s Who Actually Received Student Loan Forgiveness — and the Impact on Their Finances
Effective Strategies for Rapidly Paying Off Student Loans
