President Biden Announces Last Batch of Student Loan Forgiveness

For student loan borrowers who qualify under the Public Student Loan Forgiveness Program, I have good news for you. This is the last batch, unfortunately, of student loan forgiveness by President Biden. In total, $4.28 billion for 55,000 public service employees have had their loans discharged.

Updated on May 31, 2026.

By Alexander Hernandez, J.D., Professor, and Author of Consumer Bankruptcy Law (Routledge).

Key Takeaways: Public Service Loan Forgiveness

• A Bipartisan Statutory Mandate: Public Service Loan Forgiveness (PSLF) is a statutory right created by the bipartisan College Cost Reduction and Access Act of 2007, meaning it is federal law, not a temporary executive policy.
• The New 2026 RAP Standard: Following the judicial termination of the SAVE plan by federal courts, the Repayment Assistance Plan (RAP) under the One Big Beautiful Bill Act (OBBBA) takes effect as the primary income-driven framework on July 1, 2026.
• PSLF Timeline Unchanged: While new borrowers after July 1, 2026, will calculate their monthly obligations using the RAP formula (paying between 1% and 10% of their adjusted gross income), PSLF candidates keep the expedited 10-year (120-payment) statutory track to discharge.
• The 90-Day Window: Public servants must select an eligible Income-Based Repayment (IBR) or RAP option to keep their months counting toward forgiveness.
• Urgent Parent PLUS Countdown: Parent PLUS borrowers seeking public service relief face a hard deadline of June 30, 2026, to have a Direct Consolidation Loan fully processed and disbursed. Missing this window permanently locks them out of accessing the income-driven pathways necessary to achieve a PSLF discharge.

The Truth About Public Service Loan Forgiveness: From Political Rhetoric to the 2026 OBBBA Overhaul

Few federal student loan initiatives have been as deeply misunderstood, heavily politicized, or plagued by administrative friction as the Public Service Loan Forgiveness (PSLF) program.

Setting the Record Straight: How the College Cost Reduction Act of 2007 Governs PSLF

For more than a decade, the program barely worked. Because of confusing paperwork rules and repeated administrative failures, thousands of eligible public servants who completed their 10 years of service were wrongly denied the loan forgiveness they had earned.

The Biden administration began a major course correction. Early administrative overhauls wiped out billions in debt for waves of public service workers. By the end of these targeted actions, the Department of Education had approved more than $183 billion in student loan cancellation for 5 million Americans. Of that total, $78.4 billion went to over 1 million public servants who finally received the relief they were promised under the 2007 statute.

The 2026 Landscape: Enter the OBBBA and the Repayment Assistance Plan (RAP)

Today, the rules are changing fast under a tight rollout schedule. After the federal appeals court, specifically the U.S. Court of Appeals for the 8th Circuit, ordered the termination of the Saving on a Valuable Education (SAVE) plan, in early 2026, Congress and the Department of Education launched a sweeping overhaul through the One Big Beautiful Bill Act (OBBBA).

As we approach the critical July 1, 2026 implementation date, PSLF borrowers must understand the timeline and the steps they should take.

The Repayment Assistance Plan (RAP) Mandate

For all federal loans disbursed on or after July 1, 2026, the newly designed RAP becomes the exclusive income-driven option. Monthly payments will be between 1% and 10% of a borrower’s adjusted gross income (or a flat $10 minimum).

While RAP features a long 30-year forgiveness timeline for standard borrowers, PSLF participants retain the 10-year (120-payment) timeline and will simply utilize the RAP formula to calculate their qualifying monthly payment amounts.

The 90-Day Transition Window for Ex-SAVE Borrowers

The roughly 7 million borrowers excluded because of the demise of the SAVE plan are receiving 90-day notices from their loan servicers. If you are a public servant pursuing PSLF, you cannot afford to miss this window. Failing to proactively switch to an eligible Income-Based Repayment (IBR) plan or the new RAP framework will result in auto-enrollment into the Standard Repayment Plan.

Standard payments under auto-enrollment will not count toward your 120-month PSLF milestone unless your loan is structured to be paid off within ten years.

The Urgent Parent PLUS Consolidation Deadline

For Parent PLUS borrowers seeking public service relief, these loans are barred from enrolling in RAP. To access an income-driven pathway that feeds into PSLF, these borrowers must have their Direct Consolidation Loan fully processed and disbursed by June 30, 2026. Missing this definitive deadline permanently closes the door on IDR and PSLF eligibility for those balances.

Protecting Your Right to a Discharge

Even with ongoing lawsuits over parts of OBBBA like the new rules that bar employers with a “substantial illegal purpose,” the core PSLF program is unchanged. Your previously approved qualifying payment counts remain protected by law.

PSLF discharges also stay fully tax‑free under current federal law, even though a separate tax break for standard IDR forgiveness temporarily expired.

Today, the biggest obstacle for public servants is the backlog. The Department of Education is still processing hundreds of thousands of delayed IDR and PSLF applications.

Make sure to keep copies of every pay stub, payment receipt, and certified employment form. The law is on your side, but navigating the 2026 transition demands proactive vigilance.

Educational Resources

• For Institutions: Colleges and universities can purchase or request examination copies of my textbook directly from Routledge Publishing.
• For Students & Practitioners: Single print and digital copies are available via Amazon Books.
• Video Lectures: Stream comprehensive legal breakdowns and video explanations on the Prof. Hernandez YouTube Channel.

Bankruptcy Court & Consumer Resources

Explore a deep dive for consumer guides and court directories to navigate your legal options:

• A step-by-step master guide on Filing for Bankruptcy and Navigating the Petition.
• Access full directories for the Federal Bankruptcy Court System and Trustee Contact Information.
• Protect your assets by reviewing your specific State Bankruptcy Exemptions or compare them against the Federal Bankruptcy Exemptions.
• Prepare for your court date with the updated brief on the 341 Meeting of Creditors Rules and Procedures.

Please note that the information on this site does not constitute legal advice and should be considered for informational purposes only.