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Applying for student loan forgiveness was supposed to be ‘seamless and simple.’ So far, it’s been anything but

October 7, 2022, 3:17 PM UTC
President Biden Delivers Remarks At IBM Facility
Opponents of debt relief are complicating the one-time forgiveness.
Bloomberg

President Joe Biden’s administration says it wants the one-time student loan forgiveness effort to be “seamless and simple” when the application goes live later this month. But opponents of the up to $20,000 per borrower in debt relief, including many Republicans, are complicating things.

Last week, the U.S. Department of Education updated its loan relief FAQ to say that borrowers won’t need to upload any documents—such as tax returns—or even a Federal Student Aid (FSA) ID to apply for forgiveness.

“Our goal is to provide borrowers a seamless and simple experience, and we’re working closely with the servicers who will process the relief,” the FSA website reads. It’s not clear exactly what the application will entail, but the Department of Education says it will be a “short online application.”

That’s good news for the estimated 40 million borrowers waiting anxiously to apply. If relief actually happens, that is.

Multiple lawsuits have been filed against the debt relief, two of which have already been dismissed by federal judges. But some still stand, including a suit filed last week by six conservative state attorneys general that argues Biden is overstepping his executive powers and one filed by the Arizona attorney general that argues that student debt relief would harm the state’s economy and increase inflation

The suit filed by the six Republican states has pushed back forgiveness until at least Oct. 23, and the hearing for that case is scheduled for Oct. 12. Already, the Biden administration has scaled back who qualifies for relief, likely a result of this suit (though it has not confirmed this is the reason). Now, millions of borrowers with Federal Family Education Loan Program loans not held by the Department of Education are ineligible for forgiveness.

And even the suits that have been dismissed have caused the Biden administration to change up the forgiveness process.

“The attorneys general lawsuit is the most plausible,” says Luke Herrine, an assistant law professor at the University of Alabama. A hearing in that case is scheduled for next week.

Other possible issues

If the past is any indication, there could be problems beyond lawsuits challenging the legality of loan forgiveness.

A big one: Whether the Federal Student Aid website will be able to handle the volume of applicants that will attempt to fill out the forgiveness form when it’s released. Even traffic to the government website after Biden made the announcement overwhelmed the so much that it was inaccessible for several days.

Experts warn that some borrowers may not be able to access the application right when it goes live.

“This is going to be something that’s never happened before,” Bobby Matson, founder and CEO of Payitoff, a debt management company, previously told Fortune. Some “borrowers may have to wait a bit.”

This article has been updated with the new application date.

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