The Clock Is Running Out for Student Loan Forgiveness
Since Kamala Harris’ defeat in the 2024 Presidential election, the Biden Administration’s student loan forgiveness agenda seems in greater peril than ever. Placing student loan forgiveness at the center of a Democratic Party increasingly dominated by the college-educated didn’t result in the electoral gains politicians like Harris and Biden hoped it would, adding insult to the injury of consistent legal setbacks.
But these defeats haven’t prevented the Biden Administration from continuing to attempt to enact far-reaching student loan forgiveness policy.
Late last month, perhaps as a last-ditch effort to tempt indebted voters, the Biden Administration unveiled a set of proposed rules that would give the Education Department broad leeway to cancel student debt in cases where the borrower is facing financial “hardship.” Nearly eight million borrowers are estimated to be eligible.
“If these rules are finalized as proposed,” reads an October 25 press release, “the Secretary of Education could waive up to the entire outstanding balance of a student loan when the Department determines a hardship is likely to impair the borrower’s ability to fully repay the loan or render the costs of continued collection of the loan unjustified.”
The rules provide two main pathways to receiving student loan forgiveness. The first would not require borrowers to apply for forgiveness, and would instead be based on predictive data analysis. If this analysis predicts that a borrower has an 80 percent chance of defaulting on their loans within two years, the Department of Education could then provide one-time forgiveness of up to their entire loan balance.Â
According to the proposed rules, this analysis would be structured to prevent borrowers from deliberately going into default to receive forgiveness. T
Article from Reason.com
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