The Biden administration broadened its latest proposal for a sweeping student loan forgiveness program Thursday to borrowers facing new financial hardship qualifications, part of a modified plan after the Supreme Court rejected the initial program.
U.S. President Joe Biden speaks during a press conference in the State Dining Room of the White ... [+]
The expansion would include borrowers with balances that exceed what they initially borrowed, those with loans that have been subject to repayment 20 or 25 years ago, and borrowers with high-cost essential expenses such as healthcare or childcare.
The program would also apply to borrowers at high risk of defaulting on their loans in two years.
The proposal is part of a more limited version of President Joe Biden’s student loan program after the Supreme Court rejected the initial plan to forgive up to $20,000 in loans for Pell grant recipients and up to $10,000 for borrowers earning less than $125,000, ruling Biden overstepped his authority.
The majority-conservative Supreme Court blocked the original $400 billion plan in June last year, effectively killing a key campaign promise and what would be a hallmark policy for the president. The Department of Education has been revising the proposal over a series of rulemaking sessions, a process that could take months and will likely be subject to conservative legal challenges once it’s finalized. The Biden administration has also announced a series of incremental student loan programs in the wake of the Supreme Court decision, including canceling approximately $5 billion in student debt relief, mostly for public servants who qualified for forgiveness after 10 years through the Public Service Loan Forgiveness program. In total, the Biden administration has approved over $136.6 billion in relief for more than 3.7 million borrowers through the various programs, according to the education department.
Thursday’s expanded proposal meets a request from Democratic lawmakers and advocates to offer relief for borrowers experiencing financial hardship after the category was not included in plans discussed in the first three rulemaking sessions.