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Student Loan Forgiveness Guide

In 2023, the Biden administration's widespread student loan forgiveness plan was struck down by the Supreme Court. Despite this, President Biden has been busy unveiling targeted federal loan forgiveness to qualifying borrowers. Since the administration took office in 2020, the total amount of forgiven student debt has reached over $136 billion.

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Although widespread student loan cancellation is no longer a reality, millions of Americans could still qualify for forgiveness. With the 2024 election just around the corner, Biden has been on a roll with cancellation proposals and policies, and it doesn't seem like the administration has plans to stop anytime soon. 

Now more than ever, it's crucial to be aware of what's going on with the Education Department and how your balance could benefit. 

Do I qualify for forgiveness? 

Since general student debt cancellation is no longer an option, only those who qualify for certain federal programs will be eligible for forgiveness moving forward. However, if you haven't previously qualified for these programs, that doesn't necessarily mean that you won't ever be eligible. 

As the only legal way to enact debt cancellation, the administration has turned to amending these programs to make more borrowers eligible. An example of this is those who work in select public service professions may be eligible for cancellation through the Public Service Loan Forgiveness (PSLF) program. A 2022 waiver that has been extended permanently opened up eligibility for thousands by amending the payment count regulations.

Individuals who fall below a certain income and family size threshold may also qualify for an income-driven repayment (IDR) plan. IDR plans base your monthly payment size on your family size and annual income. After making 120 qualifying payments, your remaining federal balance will be forgiven. 

What happened with Biden's student loan forgiveness plan?

In 2022, President Joe Biden announced a plan to forgive up to $20,000 in student loans for qualifying borrowers. In the summer of 2023, the Supreme Court ruled the plan as unconstitutional in a 6-3 decision. 

The Biden-Harris administration proposed that the HEROES Act gave them the jurisdiction to enact such a measure. This act authorizes the Secretary of Education to "waive or modify" provisions of the Higher Education Act to "ensure that borrowers are not placed in a worse position financially in relation to their student loans as a result of a war, other military operation, or national emergency."

However, using the HEROES Act to cancel existing student loans was deemed as unconstitutional. Justice Roberts, Chief Justice of the United States, wrote in Biden v. Nebraska that the ruling violated the constitution. "The HEROES Act allows the Secretary [of Education] to ‘waive or modify’ existing statutory or regulatory provisions applicable to financial assistance programs under the Education Act but… does not allow the Secretary to rewrite that statute to the extent of canceling $430 billion of student loan principal.”

This decision did not impact forgiveness in general, but it did effectively put an end to the widespread cancellation proposal. The Higher Education Act allows the administration to continue making federal student loan program amendments. 

What are the latest changes to student loan forgiveness? 

Throughout 2024, the Biden-Harris administration has unveiled multiple federal student debt cancellation programs — most recently, a $6.1 billion forgiveness provision for those who attended the Art Institutes.

Here are some of the most recent student loan cancellation measures that have been announced by the Department of Education, broken up by month.   

February 2024

$1.2 billion in federal student loans was automatically discharged for qualifying borrowers under a provision made to a new income-driven repayment plan — the SAVE Plan. The SAVE (Saving on A Valuable Education) plan allows for lower monthly payments than other IDR plans. It also is the only plan that automatically covers extra unpaid monthly interest. 

March 2024

Due to a payment provision made to the Public Service Loan Forgiveness program, 77,700 borrowers had their federal debt forgiven. An additional 380,000 public servants were also notified of their future forgiveness under the program.

April 8, 2024

Biden announced his plans to cancel "runaway interest" on federal student loan debt. Should this proposal make it out of the negotiated rulemaking process intact, borrowers could see up to $20,000 accrued interest forgiveness by fall 2024. 

April 12, 2024

An additional $7.4 billion in debt forgiveness was announced for 277,000 borrowers overall, with $3.6 billion of that going to over 200,000 borrowers enrolled in SAVE. The Education Department also announced further fixes to PSLF and IDR plans, impacting 65,800 and 4,600 borrowers respectively.

May 2024

Biden announced his intent to forgive federal student loan debt for over 300,000 former students of the now-defunct private school system, the Art Institutes. Thanks to the borrower defense to repayment program, the borrowers will be receiving this immediate forgiveness since the school was found to have engaged in misleading advertising practices. 

What student loan forgiveness means for me 

How will student loan forbearance end affect me?

The student loan payment pause that placed borrowers in forbearance during the COVID-19 pandemic ended in September 2023. Though this sweeping payment pause has ended for most borrowers, you may still qualify for federal payment forbearance or deferment

These short-term relief plans temporarily freeze your federal payments while keeping your account in good standing. They're offered by the Education Department as hardship relief programs and don't result in forgiveness. 

Forbearance lasts up to 12 months at a time. Although payments are not required, interest will continue to accrue. Your deferment period will differ based on the loan type. For individuals with Subsidized and Perkins Loans, interest won't accrue during this period.

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Learn more

When it comes to paying down your debt, being empowered and knowing all of the resources you have at hand is the key to financial health. Federal student loan borrowers have a host of forgiveness programs and alternative repayment options at their disposal. 

Keep up with the current student loan trends so that you're not leaving potential forgiveness on the table.