With a week to go before President-elect Donald Trump assumes office, the Biden administration made its final stab at student loan forgiveness, providing relief for over 150,000 borrowers.
The "historic action," announced by outgoing President Joe Biden on Monday, brings the total amount of debt forgiven during his tenure to $183.6 billion, benefiting more than 5 million federal student loan borrowers.
“Since Day One of my Administration, I promised to ensure higher education is a ticket to the middle class, not a barrier to opportunity, and I’m proud to say we have forgiven more student loan debt than any other administration in history,” the statement from Biden read.
Some of the highlights from that campaign last year include a January announcement to forgive almost $5 billion in student debt for almost 74,000 borrowers, a May statement approving the cancellation of $6.1 billion in debt for reported victims of a private art-school chain, and a late-December declaration to cancel $4.28 billion for public sector workers.
The new wave of debt forgiveness includes relief for 85,000 borrowers reportedly cheated and defrauded by educational institutions; 61,000 individuals with total and permanent disabilities; and 6,100 borrowers under the Public Service Loan Forgiveness program.
According to CNBC, Monday's action effectively allocates $1.25 billion for defrauded borrowers, $2.5 billion for those with disabilities, and $465 million for public service workers.
Throughout his term, Biden’s broader plans for mass debt relief faced significant legal hurdles. That includes a 2023 Supreme Court decision blocking a measure that would have cancelled up to $20,000 in federal student loans for tens of millions of borrowers. A second attempt at mass debt relief was foiled last year as the Department of Education withdrew its plans shortly after Trump’s re-election as president, MarketWatch noted.
The administration’s announcement also acknowledged challenges, including delays in relief for borrowers approved under the borrower defense program, which supports individuals misled by their schools. Officials assured borrowers via email that their right to full discharge remains intact.
The Biden administration’s record-breaking student loan forgiveness efforts are now set to transfer to the Trump administration, which has yet to articulate plans to address the $1.7 trillion snowball of federal student debt.
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