Last week, the Biden administration announced it would make a second attempt to issue sweeping student loan relief in the coming months. The announcement comes more than a year after its first attempt prohibited by the Supreme Court.
“The Biden-Harris administration is committed to making student debt relief available to as many borrowers as quickly as possible,” Education Secretary Miguel Cardona said in a statement. statement last Wednesday. “Today, as our lengthy rulemaking process comes to an end, we are one step closer to delivering on that promise.”
The announcement was made in April draft rules Designed to implement student loan relief primarily by expanding existing loan forgiveness programs. The Department of Education said it has begun notifying borrowers of the upcoming regulations and informing them of the deadline to opt out of forgiveness.
The proposed rules target specific groups of borrowers, including those who now owe more than their original loan amount due to interest accrual, borrowers who have been making payments for decades, and those who qualify but do not participate in existing forgiveness programs of borrowers. Borrowers enrolled in low-value degree programs, such as those that “fail to provide sufficient financial value or fail to meet one of the department’s institutional accountability standards,” are also eligible for the new forgiveness effort.
Last week’s announcement also noted that those who qualify will likely receive forgiveness automatically without having to apply or take other steps.
If enacted, the rules could end up affecting more borrowers than the Biden administration’s first forgiveness program. timeThe Education Department predicts that if the proposed rules take effect, the Biden administration’s efforts over the past three years will make more than 30 million borrowers eligible for forgiveness. By contrast, Biden’s first attempt at blanket student loan forgiveness was expected Only 27 million eligible borrowers are affected.
“If finalized as proposed, these new rules would authorize relief for borrowers across the country struggling with the burden of student loan debt,” read last week’s statement. “The Biden-Harris Administration has taken historic steps to “
The Department of Education expects the final rule to be released sometime in the fall. However, with the November election approaching, it’s doubtful the department will actually be able to offer clemency before the end of Biden’s term. It’s unclear whether the Biden administration has a realistic chance of enacting such a plan, given that any attempt to enact massive loan forgiveness would almost certainly face legal challenges. For now, these latest efforts are probably best viewed as last-minute political stunts aimed at energizing young, college-educated voters rather than serious policy efforts.
