‘An albatross around my neck combined with indentured servitude’: Borrowers share tales of woe as Biden takes new stab at student-loan forgiveness

Delaying retirement, putting off buying a home and having children, and losing faith in the promise of higher education: These are some of the consequences borrowers told Department of Education officials they face because of their student debt.

In June, the Supreme Court struck down President Joe Biden’s plan to cancel up to $20,000 in student loans for borrowers earning less than $125,000. Hours after the court handed down its decision, Biden vowed to take another stab at mass student-debt forgiveness — but this second try will run through a process that takes at least several months. Tuesday’s hearing, which provided an opportunity for the public to submit comments, marked the first major step in that undertaking.

A preview of potential obstacles In addition to borrowers’ stories, the hearing also provided a preview of the kind of obstacles the Biden administration might face in bringing a broad debt-cancellation policy to fruition. The debt-cancellation plan the Supreme Court struck down in June was based on the Department of Education’s authority under the HEROES Act, a 2003 law that allows the agency to waive or modify student loans in the case of a national emergency.

Karen Harned, the chief legal officer of the Job Creators Network’s legal-action fund, said the organization doesn’t believe in student-debt forgiveness “except in some extreme outlier situations.” After those meetings, the department will release a proposed rule on debt cancellation. They’ll take feedback from the public and, after analyzing it, release a final rule. Courts likely won’t entertain any legal challenges to the plan until that process wraps up.

Yael Shavit, the chief of the consumer-protection division for the Massachusetts attorney general’s office, said, “We encourage the department to recognize the secretary’s broad authority to cancel student debt under the Higher Education Act.” Struggles to afford housing, food as student-loan payments resume Virginia Spindler shared with officials the challenges her family, which includes her husband and multiple daughters, will face when student-loan payments resume.

An undercurrent running through many borrowers’ comments was the way in which parents, counselors and the federal government pushed them toward higher education, while the promise of college these trusted sources touted remained elusive.

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