President Biden will leave office within a week after canceling student loan debt for at least five million borrowers in four years.
But the effort is a far cry from the relief he provided to more than 40 million borrowers during his time in office, as his biggest student loan proposals were blocked in court or continue to face legal hurdles.
“I am proud to say that we have canceled more student loan debt than any other administration in history,” President Biden said in a statement Monday.
It came as the Biden administration announced it has canceled the student loan debt of another 150,000 borrowers, bringing the total debt canceled in four years to 183.6 billion.
It’s a staggering amount compared to the debt wiped out before he took office, but Biden spent his term pushing to cancel the debts of tens of millions of borrowers struggling to pay back their loans.
Now those borrowers’ hopes are largely dashed by the incoming Trump administration and the Republican trifecta in Washington, as the newly elected president is expected to dramatically divert attention from the Biden administration’s priority.
Republicans have rejected student loan debt forgiveness for the past four years, saying it was unfair to taxpayers and GOP lawsuits resulted in multiple roadblocks for the Biden administration.
Going forward, the Republican Congress is considering rolling back some programs as other Biden efforts, which have resulted in lower monthly payments for millions of borrowers, remain in legal limbo.
President Biden was able to forgive more than $183 billion in student loans during his time in office despite Republican attempts to block him, but it was still far from the $400 billion he hoped to forgive with his original student loan forgiveness plan.
The Biden administration had big dreams of canceling the student debt of some forty million borrowers.
But six Republican-led states sued his first plan to forgive up to $20,000 in student debt, and the Supreme Court blocked the $400 billion effort in June 2023.
In doing so, the Biden administration took a more piecemeal approach to canceling large portions of student loan debt, including the introduction of the SAVE program, an income-boosting repayment program, as well as a “Plan B” that entails the longer regulatory process.
Last year, Republican-led states filed multiple lawsuits to block the SAVE program, which accelerated the path to debt forgiveness and lowered monthly payments for millions of borrowers.
As Biden prepares to leave office, his fate remains to be seen as a federal court order has prevented the administration from moving forward.
Borrowers in the program are patient and interest rates are not rising as the legal battle continues under the Biden administration, but that could all change with the new administration.
Aissa Canchola Bañez of the Student Borrower Protection Center warned that millions of people could face “huge spikes” in the amount they have to pay on student loans each month if the government stops defending the plan.
Meanwhile, the Biden administration also withdrew proposed student loan regulations last month, paving the way for about 30 million borrowers to receive debt forgiveness.
It was the Biden administration’s alternative approach to wiping out the debt after the Supreme Court rejected his original plan, but the proposed regulations faced opposition from Republican attorneys general even before the rules were finalized.
The Biden administration withdrew the proposed rules so the new Trump administration could not use them to move faster on its own efforts as it is “openly hostile” to debt relief.
Although the Biden administration faced legal roadblocks with its original student loan debt forgiveness plan, Plan B and the SAVE program, it was able to forgive billions in debt through changes to programs that already existed when President Biden took office, including the Public Service Loan Forgiveness Program.
Although several of the Biden administration’s attempts to cancel student loan debt have been held up in court, President Biden’s team has successfully canceled billions in debt over the past four years, largely through changes to programs that already existed.
The latest debt forgiveness announced on January 13 was through such programs.
Outgoing Education Secretary Miguel Cardona said millions of people who qualified for relief before Biden took office did not get it when his team came in four years ago.
“One of the biggest issues has been the state of our student debt relief programs. They were so cluttered with red tape and dysfunction that even if you qualified for relief, it was almost impossible to get it,” Cardona said on a call with reporters on Monday.
On that front, the government has been able to make progress by streamlining programs and resolving issues for existing programs.
Cardona said he was “immensely proud” of the system the government was able to build, which he said would “better serve generations to come.”
With changes in the Public Service Loan Forgiveness program, the Biden administration has forgiven nearly $78.5 billion in debt for more than 1 million borrowers. Before Biden took office, only 7,000 borrowers were forgiven through the program.
“I think one glimmer of hope is that we hope that this next administration will maintain all those administrative processes that the Biden administration has put in place to make it easier to qualify for relief for these public employees,” Canchola Bañez said .
Nearly 633,000 borrowers with permanent disabilities received student loan forgiveness totaling $18.7 billion over the past four years, while roughly $30 billion was canceled for borrowers defrauded by schools.
Monday’s forgiveness was the latest of 28 actions the Biden administration has taken in four years to wipe out student loan debt.
Although the Trump administration is expected to halt student debt relief efforts, it will not be able to recover the debt the debt has already been wiped away, experts said.
Senior administration officials declined to say Monday whether the latest round of debt for some 150,000 borrowers would be the last student loan debt relief before Biden leaves the White House.