In a recent ruling, the Supreme Court blocked a key route for student loan debt forgiveness, dealing a blow to President Joe Biden's sweeping plan to reduce student debt. The decision has left millions of borrowers disheartened, as they would have been eligible for loan forgiveness under the president's plan. The administration has not yet announced any alternative plan for mass student loan forgiveness, but a White House official stated that the president is "not done fighting yet" and will have more to say on the matter.
Despite this setback, there are still smaller options for relief available to borrowers that are unaffected by the ruling. These include existing programs that have been expanded with less controversy within the Biden administration, as well as state-level options. Some of these state programs were actually created in response to challenges against Biden's plan.
These programs offer relief to various groups of borrowers, such as public service workers, those who were misled by their colleges or whose institutions closed suddenly, and individuals who commit to living in rural areas. They provide options for loan forgiveness, cutting monthly payments based on income, and other forms of debt relief.
Additionally, federal loan forgiveness plans are still standing. The Public Service Loan Forgiveness program, created in 2007, allows public sector workers to have their loans forgiven after 10 years of service. The Biden administration has also made temporary changes to this program, resulting in billions of dollars in student loan forgiveness for thousands of borrowers. Simplified rules for borrowers with disabilities and proposals to cut monthly payments and forgive a greater share of debt in the long run are also in the works.
Furthermore, recent changes have made it easier for borrowers to discharge their student debt through bankruptcy. These changes were made by the Education Department and the Department of Justice, and they provide a narrow path for individuals with student debt to seek relief.
While these programs have already led to billions of dollars in forgiven student loan debt, they do not address the underlying issue of high tuition costs and other expenses that lead students to accumulate large amounts of debt. The cost of tuition and other factors that contribute to student debt remain outside the control of the federal government.
In conclusion, the Supreme Court's ruling has blocked a significant avenue for student loan debt forgiveness, but there are still options available to borrowers through existing programs and state-level initiatives. The federal government is also working on various proposals to provide relief to different groups of borrowers. However, the cost of tuition and other expenses that contribute to student debt remain unresolved.