Biden Administration Unveils Ambitious New Student Loan Forgiveness Plan

The proposal, which faces legal and political challenges, aims to offer relief to borrowers at risk of default and those experiencing hardship.

The plan introduces two pathways for loan cancellation: automatic relief for borrowers likely to default and an application process for those claiming hardship.
Eligibility criteria for 'hardship' remain vague, with Education Department officials holding significant discretion in determining who qualifies.
The Education Department estimates the plan could cost $112 billion, but independent analysts warn the cost might reach up to $600 billion.
Previous loan forgiveness efforts by the administration have been blocked by courts, casting uncertainty over the new proposal's future.
Public opinion is divided, with significant opposition due to potential impacts on taxes and inflation.