U.S. President Joe Biden gestures after speaking about student loan debt relief at Madison Regional Technical College in Madison, Wisconsin, April 8, 2024.
Andrew Caballero-Reynolds | AFP | Getty Images
The Biden administration unveiled a new proposal Friday student loans Forgive those who have gone through “economically devastating hardship”.
The eligibility rules are vague, but examples of hardships that may qualify a borrower for assistance include potential financial loss caused by: natural disasteror a huge, unexpected medical bills.
Department of Education officials told reporters on a conference call Thursday that some borrowers will automatically receive loan forgiveness, while others may have to apply.
“For a long time, our The broken student loan system “It’s wrong to make it difficult for borrowers who are experiencing heartbreaking and financially devastating hardship to obtain relief,” Education Secretary Miguel Cardona said in a statement Friday.
The announcement is the latest effort by the Department of Education under President Joe Biden to cancel people’s education debt.
Biden has forgiven more student debt than any other president in history. But so far, his most ambitious plans have been stymied by Republican-led legal challenges.
Under this latest proposed rule, which will almost certainly face more lawsuits of the same, nearly 8 million student loan borrowers experiencing severe hardship could be eligible for relief.
The official said loan cancellations could involve borrowers who are “suffering ongoing financial burdens and unable to repay their student loans” and for whom the department’s existing aid packages are not fully able to help them.
The proposed regulations could be published in the Federal Register within weeks. The Biden administration hopes to finalize the policy in 2025.
However, the department’s previous attempts to provide massive student loan relief are currently blocked by the courts after a wave of Republican-led legal challenges.
The outcome of November’s presidential election could also have an impact on the fate of those relief efforts.
Former President Donald Trump was an outspoken critic of policies that reduce or eliminate student loan holders’ balances. Democratic Vice President Kamala Harris supports the measures.
