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topicnews · October 27, 2024

Biden releases comprehensive student debt relief plan 11 days before election

Biden releases comprehensive student debt relief plan 11 days before election

The plan was approved by a group of federal negotiators earlier this year. But unfavorable judges and election uncertainty could complicate his future.

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Despite legal hurdles and the looming election, the White House is moving forward with another sweeping student debt relief plan in the final days of Joe Biden’s presidency.

The federal Education Department on Friday released the highly anticipated proposal that the Biden administration says could provide student loan forgiveness to about eight million Americans.

The proposed rules likely represent the last significant action on student debt that the Biden administration will take before deciding on the next U.S. president in early November.

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The regulations would authorize the U.S. Secretary of Education to automatically forgive the debts of potentially millions of student loan borrowers who the government expects are likely to default on their loans in the next two years, provided they meet certain criteria based on household income, assets and number of students. existing debts.

A second component of the plan would be to create a new application through which “distressed” borrowers could apply for forgiveness. These challenges include, but are not limited to, chronic illness, medical debt, child care costs, and the impact of natural disasters.

In a call with reporters Thursday, National Economic Adviser Lael Brainard said recent natural disasters in the U.S. have shown why Americans cannot continue to worry about making student loan payments in the face of major, unexpected life challenges.

“Just in the last month, we have seen the devastation that people can suffer when disasters like Hurricanes Helene and Milton strike,” Brainard said. “Repaying student debt simply shouldn’t be an additional burden in times like these.”

Rep. Virginia Foxx, a Republican congresswoman from North Carolina and outgoing chairwoman of the House Education Committee, called it a “blatant attempt to bribe voters” in the 11th hour before voters go to the polls.

Read more: Biden touts student debt relief as milestone as election and court battles loom

The proposal, greenlit by federal negotiators in February, is separate from other parts of a broader student debt relief plan that Biden committed to in April. These efforts, which have already undergone legal breaks although are ongoing, could see tens of millions of borrowers receive partial or full forgiveness.

Meanwhile, millions of borrowers are still waiting at least six months for forbearance after court challenges halted Biden’s signature student loan repayment plan, known as Saving on a Valuable Education (SAVE). Oral arguments in the case began Thursday in an appeals court. Andrew Bailey, Missouri’s Republican attorney general, said a court decision on the legality of the plan is expected in the next few weeks.

Student loan borrower advocates praised Friday’s announcement. In a statement, Persis Yu, deputy executive director of the Student Borrower Protection Center, praised the government for continuing to push for debt relief despite looming legal threats from conservatives.

“Over the last year, right-wing attorneys general have relentlessly attacked millions of working families with student debt, driving them further into debt to score political points,” Yu said.

Zachary Schermele is an education reporter for USA TODAY. You can reach him by email at zschermele@usatoday.com. Follow him on X at @ZachSchermele.

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