Biden Withdraws Student Loan Forgiveness ‘Plan B’: What’s Next For Borrowers?

President Joe Biden has abandoned his ‘plan B' of the broad student debt cancellation plan struck down by the Supreme Court in June 2023. This alternate forgiveness plan already faced legal challenges and was likely to fail under the incoming Trump administration.

In paperwork filed on Dec. 26, the Education Department cited “operational challenges” as the reason for withdrawing the proposal, which would’ve eliminated accrued interest for 23 million borrowers. The plan also aimed to forgive debt for people facing financial hardships, like expensive childcare or healthcare.

With the forgiveness plan B off its plate, Biden’s Education Department is focusing its final days on other priorities, like helping struggling borrowers return to repayment and finalizing court-ordered settlements. That may include the Sweet v. Cardona settlement for borrowers defrauded by their schools.

» MORE: How the Trump presidency may affect student loan borrowers

You must make other plans for repaying your student debt if you were counting on plan B relief. The Trump administration is likely to be less lenient toward student loan borrowers, and it may roll back affordable repayment plans or other forgiveness programs.

Existing student loan forgiveness programs to consider

Though Biden’s plan B is off the table, you may still qualify for an existing federal student loan forgiveness program. Many of these programs help longtime borrowers or those in certain professions, like teachers, nurses, government employees and other public service workers.

Here are some key student loan forgiveness programs to know:

• Public Service Loan Forgiveness (PSLF). Forgives remaining student debt after 10 years of making payments and working full-time for a qualifying nonprofit employer. 

• Income-Driven Repayment (IDR) forgiveness. Forgives remaining student debt after 20 or 25 years of payments made on an income-driven repayment plan. 

• Teacher Loan Forgiveness. Forgives up to $17,500 after five years of full-time work at a qualifying low-income school. 

• Borrower defense to repayment. Loan forgiveness and payment refunds for borrowers who were defrauded or misled by their school. 

The Biden administration is also wrapping up its IDR waiver program, which is a one-time student loan payment recount. The program forgives longtime borrowers’ debt and moves millions more closer to the IDR forgiveness finish line, even if they weren't previously enrolled in an IDR plan.

» MORE: States that will pay off your student debt

Other ways to get student loan relief right now

Consider student loan deferment or forbearance if you need immediate, short-term relief. These options allow you to postpone payments, but you could wind up paying more money over time if interest accrues during your payment pause.

If you skip payments without requesting a deferment or forbearance, you could face student loan default. Federal student loans default after a payment is at least 270 days overdue. This can result in collection costs, hits to your credit score, calls from debt collectors and wage garnishment.

For personalized repayment help, start by calling your student loan servicer. A customer service representative can walk you through your options. For further assistance, reach out to a nonprofit student loan help organization. Avoid companies that ask you to pay a fee upfront, as these can be student loan scams.

» MORE: How to get student loan help

How much student loan debt did Biden forgive?

Even without this plan B, Biden’s Education Department has forgiven $180 billion in student debt for nearly five million borrowers, as of Dec. 20, 2024.

That forgiveness tally includes:

• $78 billion for 1,062,870 PSLF borrowers.

• $56.5 billion for more than 1.4 million borrowers through income-driven repayment, including the SAVE plan and the IDR waiver.

• $28.7 billion for 1.6 million borrowers eligible for borrower defense or closed school discharges.

• $16.2 billion for 572,000 borrowers with a total and permanent disability.