this post was submitted on 15 Feb 2024
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Americans who are struggling to repay federal student loans because of financial hardship could get some of their debt canceled under President Joe Biden’s latest proposal for widespread loan forgiveness.

Several categories of borrowers would be eligible for relief under Biden’s second try at widespread cancellation after the Supreme Court rejected his first plan last year. Those with older loans or large sums of interest are being targeted for relief, for example. On Thursday, the Education Department expanded its proposal to include those who face financial hardship.

The plan was expanded amid pressure from advocates and Democrats who said the proposal didn’t do enough for struggling borrowers who don’t fit into one of the other cancellation categories.

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[–] Ranvier@sopuli.xyz 7 points 9 months ago (1 children)

Definition is somewhat vague still, the draft text is here:

https://www2.ed.gov/policy/highered/reg/hearulemaking/2023/student-loan-debt-relief-proposed-regulatory-text-section-30-91-hardship-session-4-v-1.pdf

Likely vague on purpose so the secretary of education can be flexible in setting the exact terms.

when the Secretary determines that a borrower has experienced or is experiencing hardship related to such a loan such that the hardship is likely to impair the borrower’s ability to fully repay the Federal government or the costs of enforcing the full amount of the debt are not justified by the expected benefits of continued collection of the entire debt.

There 17 different potential factors for hardship listed that could be considered, including "other."

[–] Neato@ttrpg.network 4 points 9 months ago (1 children)

Sounds like they should at the very least allow it to be discharged in bankruptcy. As that's exactly what desperate people to with untenable debt. But hopefully this accounts for the majority of people who simply can't afford to ever repay their loans.

[–] mathemachristian@lemm.ee 11 points 9 months ago