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Media Press Releases U.S. Department of Education Releases Proposal to Deliver Student Debt Relief to Borrowers Experiencing Hardship

U.S. Department of Education Releases Proposal to Deliver Student Debt Relief to Borrowers Experiencing Hardship

Advocates Applaud Potential Pathway to Debt Relief for Millions of Borrowers, Call on President Biden to “Finish the Job”

February 15, 2023 | WASHINGTON, D.C. — In advance of a fourth session of the student loan debt relief negotiated rulemaking, the U.S. Department of Education (ED) released a draft proposal to provide relief for borrowers experiencing hardship. The proposal outlines a set of factors that ED can use to identify when borrowers are experiencing hardship and automatically provides debt relief to the borrowers ED knows will most likely struggle to repay a student loan in the near future. This proposal paves the way for tens of millions of borrowers to get relief.

On Thursday and Friday of next week, ED’s rulemaking panel will reconvene to discuss this proposal. 

In response, Persis Yu, Deputy Executive Director at Student Borrower Protection Center (SBPC), issued the following statement:

“For tens of millions of working people, the pursuit of a college degree leads to a lifelong debt trap—but this proposal shows that the Biden Administration is working to change that. The new rule’s expansive definition of hardship proposed today will drive debt relief to anyone who had to borrow for college and still struggles to stay afloat. 

“Upon enacting this proposal, federal policy will finally recognize what Americans from all walks of life have known for decades—too often, higher education does not deliver on its promise of economic mobility and financial stability, and borrowers and their families should not be sentenced to a lifetime of debt as a result. The new hardship rule is a strong step in the right direction, creates an important safety valve to cancel debt when things don’t go according to plan, and provides millions of people with a second shot at the economic opportunity they were promised. We look forward to working with the Biden Administration to ensure that, this time, we finish the job and deliver debt relief to every borrower who needs it.”

This proposal follows a series of calls for a broad proposal to provide relief for millions of student loan borrowers experiencing hardship.

In December, an interdisciplinary team of economists and law scholars at the University of California Student Loan Law Initiative (UC SLLI) published a study pinpointing the amount of debt that causes this hardship to individuals and families. The study built on the research base that has grown over the last decade confirming the myriad ways student debt affects borrowers’ lives and livelihoods—diminishing homeownership, jeopardizing retirement security, inhibiting savings, undermining financial security, increasing the cost of other financial products, steering borrowers away from public service careers, contributing to workforce shortages in health care, driving highly-educated young people out of rural communities, slowing small business formation and dampening growth of the entire U.S. economy.

Further Reading

  • UC SLLI’s legal analysis demonstrating that the Secretary of Education has the authority under the Higher Education Act to deliver relief for borrowers experiencing hardship: 


About Student Borrower Protection Center

Student Borrower Protection Center (SBPC) is a nonprofit organization focused on eliminating the burden of student debt for millions of Americans. We engage in advocacy, policymaking, and litigation strategy to rein in industry abuses, protect borrowers’ rights, and advance racial and economic justice.

Learn more at or follow SBPC on Twitter @theSBPC.

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