The new plan, announced Monday, is focused largely on borrowers with so-called “runaway interest” who owe more money than they did at the start of repayment.
If finalized, the plan would likely go into effect this fall, potentially adding to the millions of people who have already seen some debt relief under the Biden administration’s executive plans.
But it risks being legally challenged by Republicans who don’t back student debt relief
Administration officials told reporters the plan is consistent with the Supreme Court’s decision last June that blocked Biden’s broad student loan forgiveness plan.
“We have studied the Supreme Court’s decision carefully,” an official told reporters. “We intend to pursue these regulations in a way that is entirely consistent with that decision.”
The Supreme Court striking down Biden’s student debt relief plan, which aimed to help more than 40 million borrowers receive loan forgiveness, was a major blow to the president and his campaign promises to forgive such loans.
That plan would have canceled up to $20,000 in loans for Pell Grant recipients and $10,000 for other borrowers, if the individual’s income is less than $125,000.
At the time, President Biden vowed to find new actions to help student loan borrowers, declaring that the “fight is not over.”
Monday’s announcement would help the largest swath of borrowers since the Supreme Court struck down the original plan.
Student loan forgiveness is top of mind for many voters, especially young people who Biden needs to attract ahead of November.
Biden has faced a lack of enthusiasm with young Americans, who may have concerns that Biden is too old for another term, disagree with him on policy issues, or aren’t happy that the 2024 race is a rematch of 2020.
The Hill’s Alex Gangitano has more here.
