{"id":30825,"date":"2023-10-30T21:05:38","date_gmt":"2023-10-30T21:05:38","guid":{"rendered":"https:\/\/microloannexus.com\/personal-finance\/biden-unveils-major-details-on-new-student-loan-forgiveness-plan\/"},"modified":"2023-10-30T21:05:40","modified_gmt":"2023-10-30T21:05:40","slug":"biden-unveils-major-details-on-new-student-loan-forgiveness-plan","status":"publish","type":"post","link":"https:\/\/microloannexus.com\/?p=30825","title":{"rendered":"Biden Unveils Major Details On New Student Loan Forgiveness Plan"},"content":{"rendered":"
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The Education Department has released the most detailed information yet on a new student loan forgiveness program being developed by the Biden administration. According to these updates, officials are honing in on providing debt relief to four distinct groups of borrowers, as well as a fifth group tied to financial hardship.<\/p>\n

The new program, designed to replace the student loan forgiveness plan that was scrapped by the Supreme Court last summer, is in the midst of a lengthy rulemaking process. The department has released new draft regulatory text in advance of the next round of public hearings.<\/p>\n

Here\u2019s what borrowers need to know about the new student loan forgiveness plan including who may qualify, and when the relief could be available.<\/p>\n

Second Attempt At Broad Student Loan Forgiveness<\/h2>\n

The newest student loan forgiveness plan is essentially the administration\u2019s \u201cPlan B\u201d in response to this summer\u2019s ruling overturning Biden\u2019s initial debt relief plan. That initiative would have wiped out up to $20,000 in federal student loans for millions of borrowers.<\/p>\n

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To establish that first plan, the Biden administration relied on the HEROES Act. This statute, passed by Congress more than two decades ago in response to the September 11th terrorist attacks, gives the Secretary of Education legal authority to modify or waive the normal rules governing the federal student loan system. Relying on this statute was an attractive option for administration officials as it allowed the Education Department to bypass the normal regulatory drafting process, which can be lengthy and tedious. But the Supreme Court ruled in June that despite broad statutory language, Congress did not expressly provide authority for student loan forgivenes when it passed the HEROES Act.<\/p>\n

So the Biden administration is trying again \u2014 this time, via the Higher Education Act. Unlike the HEROES Act, the HEA does expressly allow the Education Department to waive or reduce federal student loans. And multiple administrations in both major political parties have relied on the HEA to eliminate federal student loan debt, although not on a mass scale.<\/p>\n

The Education Department is currently going through a rulemaking process, which is typically required to write new rules for HEA programs, to create this new student loan forgiveness plan. The department established a rulemaking committee of stakeholders, which will try to find consensus on the rules and parameters governing the new program through a series of public meetings. The committee held its inaugural hearing earlier this month.<\/p>\n

Four Groups Of Borrowers Eyed For Student Loan Forgiveness Under New Plan<\/h2>\n

In advance of the next rulemaking committee meeting scheduled for next week, the Education Department on Monday released draft regulatory text identifying four groups of borrowers for student loan forgiveness under the new program. This text provides more details than ever on what top officials may be thinking, and expands upon an issue paper issued earlier this month that provided some initial guidance.<\/p>\n

The Biden administration is eyeing student loan forgiveness for four primary borrower groups:<\/p>\n