No, Supreme Court ruling does not eliminate other student loan forgiveness programs

The Supreme Court on June 30 struck down the Biden administration’s plan for one-time student loan forgiveness for most borrowers. People with student loans will no longer be set to receive $10,000 to $20,000 in forgiveness.

Since the decision, many people have gone to Google with questions about whether other types of student loan forgiveness is still happening, such as public service loan forgiveness or forgiveness for income-driven repayment plans.

THE QUESTION

Did the Supreme Court eliminate all student loan forgiveness programs?

THE SOURCES

THE ANSWER

No, the Supreme Court did not eliminate all student loan forgiveness programs. The decision only impacted the Biden administration’s plan for one-time student loan forgiveness.

WHAT WE FOUND

The Supreme Court struck down the Biden administration plan to forgive $10,000 to $20,000 in student debt for most borrowers. However, other forgiveness programs that have existed for years remain in place, although only borrowers who meet specific conditions qualify for those.

In the opinion he wrote for the Supreme Court in Biden v. Nebraska, Chief Justice John Roberts said that Congress has granted the Secretary of Education a limited authority to forgive student loans.

“The affected statutory provisions granted the Secretary the power to ‘discharge [a] borrower’s liability,’ or pay the remaining principal on a loan, under certain narrowly prescribed circumstances,” Roberts said. “Those circumstances were limited to a borrower’s death, disability, or bankruptcy; a school’s false certification of a borrower or failure to refund loan proceeds as required by law; and a borrower’s inability to complete an educational program due to closure of the school. The corresponding regulatory provisions detailed rules and procedures for such discharges. They also defined the terms of the Government’s public service loan forgiveness program and provided for discharges when schools commit malfeasance.”

The problem with the Biden administration’s program, Roberts wrote, was that it “created a novel and fundamentally different loan forgiveness program.”

The U.S. Department of Education lists many different student loan forgiveness programs it already administers, which are not affected by the ruling. This list does not include the Biden plan that was struck down. The Congressional Research Service also noted that the proposed Biden plan was separate from these existing programs. 

One of the most popular programs is Public Service Loan Forgiveness (PSLF), which forgives a borrower’s Direct Loans if they work in certain public service jobs and make 120 payments on their loans, says MOHELA, a student loan servicer. The Department of Education says it has approved $42 billion in forgiveness for 615,000 borrowers in PSLF since Oct. 2021.

Any borrower with an Income-Driven Repayment (IDR) plan will have their remaining loans forgiven after making 20 to 25 years of payments. Whether you have balance leftover to forgive depends on how large your income is relative to your debt, the Education Department says.

The Education Department also regularly eliminates student loan debt for borrowers who have been misled or suffered from misconduct by certain colleges in a program called borrower defense. These are usually for students who attended defunct for-profit colleges, such as ITT Technical Institute.

Other forgiveness programs listed by the Education Department’s Federal Student Aid website include forgiveness programs for teachers, people with disabilities, people who have died and people who have filed for bankruptcy.