In its final weeks, the Biden administration is making a last-ditch effort to enact new federal rules aimed at providing student loan forgiveness to 8 million borrowers facing financial hardships.
The proposed rule would rely on predictive modeling to determine which borrowers are at least 80% likely to default on their loans, offering them one-time debt relief.
Additionally, the rule allows for a “holistic assessment” of financial hardship, potentially including future borrowers, to qualify for relief.
The Department of Education announced the proposed rule on October 31, initiating a public comment period set to close on December 2. The expedited timeline has raised eyebrows, as the federal rulemaking process often spans several months or years.
Critics view the effort as a last-minute attempt to cement policies ahead of President-elect Donald Trump’s administration taking over in January.
The move follows a series of legal defeats for Biden’s earlier attempts to cancel student debt, which courts ruled exceeded executive authority. Nevertheless, the administration has persisted, arguing that targeted relief is necessary to address financial hardship and prevent loan defaults.
Republican lawmakers and some legal analysts have questioned the legality of the proposed rule, with concerns about its rushed implementation and broad scope.
If finalized, the rule could face immediate legal challenges, adding to the ongoing debate over the limits of executive power in addressing student debt.
