Chaos: the word experts chose time and again to describe the current state of student debt relief efforts and loan repayment. Since President Biden’s first attempt to clean the slate for millions of student borrowers was struck down by the U.S. Supreme Court in June 2023, each subsequent effort has encountered lawsuits and judicial rulings that have diluted or negated aspects of the plans with impacts varying depending on location.
“It’s been an incredibly challenging and chaotic year in student loan space,” said Persis Yu, deputy executive director and managing counsel at the Student Borrower Protection Center, a nonprofit organization working to eliminate student debt. “It’s been incredibly hard for borrowers to get good, accurate information.”
Persis Yu, deputy executive director and managing counsel at the Student Borrower Protection Center.
The past year’s chaos and future confusion is the consequence of the highly politicized nature of higher education and its components, experts agreed. Those who remain most impacted by these decisions are the borrowers themselves.
As of December 2023, 43.2 million Americans have student loan debt, according to the Federal Student Aid office. The national balance is more than $1.6 trillion. The debt burden is not distributed equally among students.
A May 2024 report by the Education Data Initiative found that four years after graduation, Black borrowers owe an average of 188% more than white borrowers and hold an average of $53,000 in debt.
“Several years down the road, we might find some people navigated this unfortunately, through no fault of their own but the confusion the system has created in this situation,” said Dr. Nicholas Hillman, professor in the School of Education at the University of Wisconsin-Madison and coauthor of Understanding Student Debt: Who Borrows, the Consequences of Borrowing, and the Implications for Federal Policy.
