The Potential Impact of a Biden Victory in 2024 on Student Loan Debt
President Joe Biden has been advocating for student loan debt forgiveness throughout his term. In 2023, the Supreme Court rejected his initial plan to cancel $400 billion in student loan debt.
Recently, Biden has been developing a new plan aimed at forgiving loans for certain groups, such as those with older loans, high-interest loans, or those facing financial hardship. For older loans, forgiveness would apply to those who have been repaying for 20 to 25 years, depending on the loan type. Borrowers with high-interest loans might be eligible for $10,000 to $20,000 in forgiveness. Financial hardship would include borrowers likely to default based on their repayment history and current income. This plan is still under discussion and has not yet been approved.
Despite the Supreme Court’s rejection, Biden has managed to significantly reduce or eliminate student debt for some borrowers. During his presidency, over 3.7 million borrowers have had more than $136 million in debt forgiven through executive actions.
Looking ahead, if Biden wins reelection, will this progress continue? Experts suggest that for Biden to succeed in further relieving student loan debt, Democrats need to regain control of the House of Representatives, which currently has a Republican majority with 219 representatives compared to 212 Democrats. Jacob Channel, a U.S. housing and student loan repayment expert at LendingTree, believes that without a Democratic majority, any broad student loan forgiveness bills would likely fail. Channel also noted that Biden might include student loan forgiveness in his reelection campaign, given its importance to millions of Americans.
Kathleen Boyd, a student loan advisor at Student Loan Planner, mentioned that Biden’s colleagues’ views of him could influence student loan policy changes. If reelected, Biden might be seen as a “lame duck,” potentially leading to either minimal action on student loans or a push for the most progressive student loan agenda ever. Boyd believes Biden will likely continue working with the Department of Education to pass more forgiveness measures.
So far, those who have benefited from debt relief include borrowers in the Public Service Loan Forgiveness Program, typically government and nonprofit workers, who have had $56.7 billion in loans forgiven. Additionally, borrowers on income-driven repayment plans have seen $45.7 billion in loan forgiveness. Those who took out less than $12,000 on a Saving on a Valuable Education (SAVE) loan and have been repaying for at least 10 years also qualified for forgiveness.