Student-loan borrowers with 'hardship' could be eligible for Biden's next round of relief if the administration can define what that means

Cancel student debt sign outside of Supreme Court
People rally in support of the Biden administration's student debt relief plan in front of the the U.S. Supreme Court on February 28, 2023 in Washington, DC. Drew Angerer/Getty Images
  • The Education Department released its draft text for its new student-debt relief plan.

  • It outlined four groups of borrowers it is prioritizing for loan forgiveness.

  • A fifth group, borrowers with "hardship," will be discussed at upcoming negotiations.

Over the past few years, Insider has heard from a range of borrowers who have struggled to get ahead of their student debt.

From parents who took on loans for their kids and cannot pay it off, to older borrowers who cannot stay on top of the surging interest, millions of borrowers have dealt with unique student debt experiences that have hindered their lives.

Now, President Joe Biden's Education Department is moving forward with its new plan for student-loan forgiveness — and it wants feedback on which situations would meet a "hardship' standard for relief.

Earlier this week, the Education Department released the draft regulatory text of its new plan for student-debt relief using the Higher Education Act of 1965. At the end of June, the Supreme Court struck down Biden's first plan for relief, and this second attempt requires the administration to go through negotiated rulemaking: a lengthy process that includes a series of negotiation sessions and opportunity for public comment.

The draft text of the plan outlined four groups of borrowers the department is prioritizing for debt relief":

  • those with outstanding balances that exceed what they originally borrowed;

  • those who have loans in repayment for 25 or more years;

  • those who took out loans to attend programs that left them with too much debt compared to earnings;

  • and those who are eligible for forgiveness under targeted repayment plans but have yet to apply for the relief.

The department also released an issue paper for negotiators to discuss during the next session regarding a fifth group of borrowers: "those experiencing hardship that is not otherwise addressed by the existing student loan system."

The department said it did not include that group of borrowers in its initial draft text for debt relief because it needs to further define what hardship means. For the upcoming sessions on November 6 and 7, it wants negotiators to discuss questions surrounding hardship including:

  1. Whether it should apply the standard used for student-loan discharges via bankruptcy to determine hardship for debt relief

  2. What administrative data might already be available to the department to determine hardship

  3. What information borrowers should have to provide in a potential application for proving hardship

  4. And how the department should determine whether federal poverty guidelines are a sufficient approximation of a borrower's necessary expenses.

During the negotiation sessions in October, negotiators suggested a range of indicators that a borrower might be experiencing hardship, including those who received Pell Grants, have significant childcare or medical expenses, or have a disability. The department's negotiator Tamy Abernathy also made clear that this second attempt at debt relief will be more narrow than the first time around, saying that "we are not looking at a broad-based debt cancellation where we are going to wipe off debt in its entirety."

Those who want to watch the negotiations next week can register at this link. At the end of each session, there will be one hour for public comment, and those who wish to participate can submit their name and affiliated organization to

Do you think your student debt experiences should qualify as hardship? Share your story with this reporter at

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