Savanna Hoffman
President Joe Biden's student loan forgiveness plan has been a controversial topic. While the Biden administration has overseen $136.6 billion in loan forgiveness, the Supreme Court blocked his broader student debt cancellation plan, citing concerns about the cost to taxpayers. Biden's plan, estimated to cost taxpayers $1.4 trillion, has been criticized for shifting the debt burden to taxpayers who did not take out student loans. The Biden administration has made efforts to ease repayment plans, such as extending payment forbearance and introducing the SAVE plan, but these actions have also faced legal challenges and criticism for not addressing the core issue of cost. The debate around student loan forgiveness highlights the complex financial landscape of American higher education and the impact of policy decisions on borrowers and taxpayers.
| Characteristics | Values |
|---|---|
| Total student debt | $1.6 trillion |
| Number of borrowers | 42.7 million |
| Number of borrowers in default | 5 million+ |
| Number of borrowers in delinquency | 4 million |
| Number of borrowers unable to begin repayment | 1.9 million |
| Total loan forgiveness overseen by Biden Administration | $136.6 billion |
| Number of borrowers who have benefitted from loan forgiveness | 3.7 million |
| Amount forgiven through IDR account adjustment | $45.7 billion |
| Amount forgiven for public servants through PSLF | $56.7 billion |
| Amount forgiven for borrowers with a total and permanent disability | $11.7 billion |
| Amount forgiven for borrowers eligible for the borrower defence to repayment program | $22.5 billion |
| Biden's student debt cancellation plan status | Blocked by Supreme Court |
| Biden Administration's projected cost of student loan cancellation plans | $1.4 trillion |
| Status of SAVE Plan | Ruled unlawful by a federal court |
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What You'll Learn
- Biden's student debt cancellation plan blocked by the Supreme Court
- The Biden Administration has overseen \$136.6 billion of loan forgiveness
- The SAVE Plan was deemed unlawful by a federal court
- The Biden Administration has been accused of misleading borrowers
- The Department of Education is improving federal student loan repayment options
Biden's student debt cancellation plan blocked by the Supreme Court
In a bid to provide relief to vulnerable borrowers, President Joe Biden's administration had proposed a student debt cancellation plan. This plan promised $10,000 in federal student debt forgiveness to individuals with incomes below $125,000 or households earning less than $250,000. Pell Grant recipients were eligible for an additional $10,000 in relief. The Biden administration argued that the loan cancellations were legal under the 2003 HEROES Act, which allows the secretary of education to "waive or modify any statutory or regulatory provision" of financial assistance programs.
However, the Supreme Court blocked Biden's student debt cancellation plan. The court ruled that the plan "created a novel and fundamentally different loan forgiveness program" that exceeded the scope of the HEROES Act. The court also found that the secretary of education does not have the power to "waive" laws and regulations related to the student loan program. The Biden administration's proposal was challenged by six states with Republican attorneys general and two individuals with student loans, who argued that the plan did not comply with the HEROES Act and other federal laws.
Despite the Supreme Court's decision, the Biden administration has still overseen $136.6 billion of loan forgiveness as of January 19, 2024. This includes $45.7 billion through a one-time IDR account adjustment, $56.7 billion for public servants through Public Service Loan Forgiveness (PSLF) improvements, $11.7 billion for borrowers with total and permanent disabilities, and $22.5 billion for eligible borrowers under the borrower defense to repayment program. The Biden administration has also expanded the federal student loan program's capacity to forgive debt, introduced an income-driven repayment (IDR) account adjustment, and helped defrauded borrowers obtain refunds from closed colleges.
While the Supreme Court's decision blocked Biden's broad student debt cancellation plan, the administration has continued to provide targeted loan relief and expand existing forgiveness programs to assist borrowers. The FSA and the U.S. Department of Education are working to assist borrowers in getting out of default and resume federal student loan collections, with detailed information available on StudentAid.gov/end-default.
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The Biden Administration has overseen \$136.6 billion of loan forgiveness
Despite failing to deliver on his promise for broad student loan forgiveness, President Joe Biden has overseen the cancellation of student loans for more than 5 million Americans, more than any other president in US history. The Biden Administration has so far overseen $136.6 billion of loan forgiveness.
Biden's Education Department has forgiven $136.6 billion worth of student debt for more than 3.7 million borrowers under existing federal student loan forgiveness programs. This includes $45.7 billion for 930,500 borrowers through a one-time IDR account adjustment, $56.7 billion for 793,400 public servants through Public Service Loan Forgiveness (PSLF) improvements, $11.7 billion for 513,000 borrowers with a total and permanent disability, and $22.5 billion for 1.3 million borrowers eligible for the borrower defence repayment program.
The Biden Administration has also expanded the federal student loan program's capacity to forgive student debt. It unveiled an income-driven repayment (IDR) account adjustment to make it easier for borrowers to qualify for loan forgiveness, helped defrauded borrowers get refunds from closed colleges, and granted relief to disabled borrowers. A new IDR plan, called SAVE, could halve monthly payments for millions of borrowers and lead to loan forgiveness.
However, critics argue that Biden has failed to address the core problem that prompted public pressure for forgiveness in the first place: cost. Federal student loans are financed by the American people, and critics argue that the Biden Administration's actions have put taxpayers on the hook for irresponsible lending, pushing the federal student loan portfolio towards a fiscal cliff.
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The SAVE Plan was deemed unlawful by a federal court
The SAVE Plan, which stands for Saving on a Valuable Education, was a repayment plan introduced by the Biden administration to halve monthly payments for millions of borrowers and lead to loan forgiveness. The plan was met with criticism, with some arguing that the plan was illegal and that it would hurt taxpayers.
In June 2024, a federal court blocked parts of the SAVE Plan, and borrowers enrolled in the plan had their federal student loans placed in forbearance with a zero percent interest rate. This was followed by a ruling from the Eighth Circuit Court of Appeals in February 2025, which held that the SAVE Plan was unlawful. The court's decision was based on the argument that the Department of Education lacked the authority to carry out the SAVE program.
The Biden administration's efforts to provide student debt relief through the SAVE Plan were thus halted by the federal court's injunction, which prevented the full implementation of the plan. As a result of the court's ruling, the Department of Education was instructed to begin charging interest on impacted loans starting on August 1, 2025.
The SAVE Plan's fate remains uncertain, with the case being returned to a lower district court for a final ruling. The Biden administration has faced criticism for its handling of student loan repayment policies, with some arguing that they have failed to address the core problem of cost. However, supporters of the administration's efforts argue that they have done more for vulnerable student borrower populations than any other administration.
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The Biden Administration has been accused of misleading borrowers
The Biden-Harris Administration has put taxpayers "on the hook" for irresponsible lending, pushing the federal student loan portfolio toward a fiscal cliff. There are currently 42.7 million borrowers who owe more than $1.6 trillion in student debt. Of these, 5 million have not made a monthly payment in over 360 days, and 4 million are in late-stage delinquency. As a result, there could be almost 10 million borrowers in default in a few months, which would mean that almost 25% of the federal student loan portfolio will be in default.
The Biden Administration has overseen $136.6 billion of loan forgiveness so far. This includes $45.7 billion for 930,500 borrowers through a one-time IDR account adjustment, $56.7 billion for 793,400 public servants through Public Service Loan Forgiveness (PSLF) improvements, $11.7 billion for 513,000 borrowers with a total and permanent disability, and $22.5 billion for 1.3 million borrowers eligible for the borrower defense to repayment program.
The Biden Administration has also extended payment forbearance and stepped up targeted loan relief. Additionally, the federal student loan program has vastly expanded its capacity to forgive student debt under Biden. His administration unveiled an income-driven repayment (IDR) account adjustment to make it easier for borrowers to qualify for loan forgiveness, helped defrauded borrowers get refunds from closed colleges, and granted disabled borrowers relief.
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The Department of Education is improving federal student loan repayment options
The Department of Education is working to improve federal student loan repayment options for borrowers. The Biden administration has overseen $136.6 billion of loan forgiveness under existing federal student loan forgiveness programs. This includes $45.7 billion for 930,500 borrowers through a one-time IDR account adjustment, $56.7 billion for 793,400 public servants through Public Service Loan Forgiveness (PSLF) improvements, $11.7 billion for 513,000 borrowers with total and permanent disabilities, and $22.5 billion for 1.3 million borrowers eligible for the borrower defence repayment program.
The Department has also expanded its capacity to forgive student debt by introducing an income-driven repayment (IDR) account adjustment, making it easier for borrowers to qualify for loan forgiveness. A new IDR plan, called SAVE, could reduce monthly payments for millions of borrowers and lead to loan forgiveness. The Department is also assisting borrowers in selecting a legal repayment plan that suits their needs and helps them achieve financial stability.
The Department has been addressing the backlog of submitted IDR applications caused by a processing pause implemented by the previous administration. It has resumed collections and contacted millions of borrowers to remind them of their legal repayment obligations and the benefits of making regular payments. The Department has also provided detailed information to help borrowers get out of default and encouraged borrowers with loans in the SAVE Plan to use the Loan Simulator to estimate monthly payments under different repayment plans.
The SAVE Plan has faced legal challenges, with federal courts blocking parts of it and ruling that the Department cannot unilaterally waive federal student loans. As a result, borrowers enrolled in the plan had their federal student loans placed in forbearance with a zero per cent interest rate. The Department is now instructing its federal student loan servicers to begin charging interest on impacted loans, with interest accruing from August 1, 2025.
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Frequently asked questions
Biden's plan to pay for student debt forgiveness is through the federal student loan program, which has expanded its capacity to forgive student debt. The cost of Biden's student loan cancellation plans could cost taxpayers a combined $1.4 trillion.
Critics argue that Biden has shifted the cost of higher education onto taxpayers who did not willingly take out student loans. They claim that the plan is unlawful and that the Biden Administration is trying to "illegally force taxpayers to foot the bill."
Biden's Education Department has forgiven $136.6 billion worth of student debt for more than 3.7 million borrowers as of January 19, 2024.
