--- title: Biden Administration Changes Student Loan Forgiveness Eligibility description: In a quiet reversal of the administration’s original plans, borrowers with some older loans will no longer qualify for debt relief. authors: - name: Sarah Hansen role: Senior Writer url: https://money.com/author/sarah-hansen/ bio: Sarah Hansen is a senior writer at Money covering all things personal finance. Previously, she covered economic policy and capital markets on the breaking news desk at Forbes. education: Northwestern University, New York University at_money_since: 2021 articles: 347 covers: - Personal Finance - Banking - Business - Career Advice - Credit - Credit Cards - Economy and Politics - Education - Health and Wellness - Housing - Insurance - Investing - Lifestyle - Loans - Mortgages - Professional Services - Retirement - Shopping - Taxes social: - https://www.linkedin.com/in/sarah-m-hansen/ former_staff: true editors: - name: Kaitlin Mulhere role: Editor url: https://money.com/author/kaitlin-mulhere/ bio: Kaitlin Mulhere has been covering the intersection of college and personal finance since 2015. She enjoys breaking down the complexities of college costs and financial aid, and she also runs Money’s Best Colleges. education: University of Florida at_money_since: 2015 articles: 217 covers: - Personal Finance - Banking - Business - Career Advice - Credit - Credit Cards - Debt - Economy and Politics - Education - Health and Wellness - Housing - Identity Theft - Insurance - Investing - Lifestyle - Loans - Mortgages - Retirement - Shopping - Taxes social: - https://twitter.com/KMulhere - https://www.linkedin.com/in/kaitlin-mulhere-64503048/ published: '2022-09-30T17:50:54.000Z' modified: '2024-01-10T13:24:30.000Z' section: Personal Finance tags: - News - student debt - Student Loans word_count: 477 canonical: https://money.com/student-loan-forgiveness-eligibility-ffel-borrowers/ type: NewsArticle source: structured-blocks --- > **Disclosure:** We research all brands listed and may earn a fee from our partners. Research and financial considerations may influence how brands are displayed. Not all brands are included. [Learn more](https://money.com/page/disclaimer/). ![Joe Biden giving a speech at in-front of the White House](https://img.money.com/2022/09/News-Biden-Changes-Student-Loan-Forgiveness.jpg?crop=0px%2C0px%2C3122px%2C1756px&quality=85) The Education Department just made a major change to its [student loan forgiveness](https://money.com/student-loan-forgiveness-who-qualifies/) eligibility rules. In a quiet reversal of the administration’s original plans, borrowers with some Federal Family Education Loans (FFEL) and Perkins loans will no longer be able to qualify for debt cancellation of up to $20,000. The department said when it announced the plan that borrowers needed to have “federally held” student loans to qualify for one-time debt forgiveness. But officials also said at the time that borrowers with ineligible loans would be able to access the relief after filling out paperwork to convert their loans into eligible ones. Roughly 4 million borrowers have those ineligible, privately-held FFEL loans. But the change won’t affect every one of them. Some of those borrowers may also hold eligible loans and therefore, may still qualify for some debt relief. About 800,000 borrowers will be affected by the new rule, a Biden administration official [told NPR](https://www.npr.org/2022/09/29/1125923528/biden-student-loans-debt-cancellation-ffel-perkins). “As of Sept. 29, 2022, borrowers with federal student loans not held by ED cannot obtain one-time debt relief by consolidating those loans into Direct Loans,” the [studentaid.gov](https://studentaid.gov/debt-relief-announcement/one-time-cancellation) website now reads. As of earlier this week, the Education Department’s guidance indicated the borrowers would be able to consolidate these types of loans in order to qualify for the debt relief. Neither FFEL loans nor Perkins loans are issued today, and there’s a critical difference between these older federal loans and the ones that have been issued since the two programs were sunset in 2010 and 2018, respectively. While most of these loans are guaranteed by the federal government, they’re held and managed by private banks. That distinction is also the reason many FFEL and Perkins loans were [ineligible](https://money.com/ffel-perkins-loans-coronavirus-relief/) for the pandemic payment pause. ## Lawsuits threaten student loan forgiveness The likely reason for the sudden reversal in the eligible rules is the administration’s worry that the private banks that manage old FFEL loans (the ones that have not been consolidated into federal Direct Loans) could sue to block the debt forgiveness on the grounds that they will lose money when those loans are forgiven. This argument has already cropped up in a [lawsuit](https://storage.courtlistener.com/recap/gov.uscourts.moed.198213/gov.uscourts.moed.198213.1.0.pdf) filed this week by the attorneys general of Nebraska, Missouri, Arkansas, Iowa, Kansas and South Carolina. They argue that encouraging borrowers to consolidate FFEL loans held by a major Missouri student loan servicer into federal Direct Loans that qualify for debt relief “harms the entity by depriving it of the ongoing interest payments that those loans generate.” The Education Department says it is exploring other pathways to offer debt relief to borrowers with privately-held FFEL and Perkins loans, but it’s not yet clear what those pathways may look like. ```json { "@context": "https://schema.org", "@graph": [ { "@type": "BreadcrumbList", "@id": "https://money.com/student-loan-forgiveness-eligibility-ffel-borrowers/#breadcrumb", "itemListElement": [ { "@type": "ListItem", "position": 1, "name": "Home", "item": "https://money.com" }, { "@type": "ListItem", "position": 2, "name": "Personal Finance", "item": "https://money.com/personal-finance/" }, { "@type": "ListItem", "position": 3, "name": "Student Loan Debt", "item": "https://money.com/student-loan-debt/" }, { "@type": "ListItem", "position": 4, "name": "Biden Administration Changes Student Loan Forgiveness Eligibility" } ] }, { "@type": "WebSite", "@id": "https://money.com/#website", "url": "https://money.com", "name": "Money", "publisher": { "@id": "https://money.com/#organization" } }, { "@type": "WebPage", "@id": "https://money.com/student-loan-forgiveness-eligibility-ffel-borrowers/#webpage", "url": "https://money.com/student-loan-forgiveness-eligibility-ffel-borrowers/", "name": "Biden Administration Changes Student Loan Forgiveness Eligibility", "isPartOf": { "@id": "https://money.com/#website" }, "datePublished": "2022-09-30T17:50:54.000Z", "mainEntity": { "@id": "https://money.com/student-loan-forgiveness-eligibility-ffel-borrowers/" }, "inLanguage": "en-US", "breadcrumb": { "@id": "https://money.com/student-loan-forgiveness-eligibility-ffel-borrowers/#breadcrumb" }, "dateModified": "2024-01-10T13:24:30.000Z" }, { "@type": "NewsArticle", "headline": "Biden Administration Changes Student Loan Forgiveness Eligibility", "articleSection": "Personal Finance", "image": [ { "@type": "ImageObject", "url": "https://img.money.com/2022/09/News-Biden-Changes-Student-Loan-Forgiveness.jpg?crop=0px%2C0px%2C3122px%2C1756px&quality=85", "width": 1012, "height": 569, "caption": "News-Biden-Changes-Student-Loan-Forgiveness" } ], "author": [ { "@type": "Person", "name": "Sarah Hansen", "url": "https://money.com/author/sarah-hansen/", "@id": "https://money.com/author/sarah-hansen/#author", "description": "Sarah Hansen is a senior writer at Money covering all things personal finance. 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