Nearly Half of College Students Expect Positive Impacts From Loan Forgiveness

Amid concerns about the legality of President Biden’s student loan forgiveness plan and numerous lawsuits that have been filed in an attempt to stop it, college students are sharing how they will be impacted should the plan move forward.

In a new BestColleges survey of 1,002 current and prospective undergraduate and graduate students, 44% say they believe they have been or will be positively impacted by the president’s student loan forgiveness plan. Less than a quarter of students (23%) disagree and 32% are neutral.

Millennial students, in particular, are highly likely to say they believe they will see positive impacts from the plan (54%). However, this same demographic (47%) thinks Biden’s plan doesn’t go far enough to alleviate student debt.

Despite previous reports indicating that borrowers of color are most likely to see positive impacts under Biden’s loan forgiveness plan, nearly an equal percentage of white (45%) and BIPOC (43%) survey respondents say they anticipate that they will be positively impacted by it.

Just 31% of surveyed students say that they currently have federal student loans they took out prior to June 30, 2022, the cut-off date to be eligible for loan forgiveness under Biden’s plan. And about 1 in 5 students (21%) say they paid off their federal student loans during the pandemic-related payment pause that started in March 2020.

Together, these responses suggest that up to 52% of survey respondents may be eligible for some amount of loan forgiveness under Biden’s plan.

Regardless of their loan status, the majority of students (54%) still say they are in favor of President Biden’s federal student loan forgiveness plan.

Students who identify as Democrats are significantly more likely than Republicans to say they support the plan (69% vs. 42%).

Even among students with no federal student loan debt, 53% still support Biden’s plan. The majority of these students (58%) are additionally in favor of some form of federal student loan forgiveness.

The unveiling of Biden’s plan has attracted criticism as key eligibility details were missing from the original announcement and the administration has backtracked on who qualifies.

Students who paid off their loans during the pandemic-related payment pause are much less likely to be in favor of Biden’s plan, with just 45% expressing support for it. These students may not be aware that under the president’s plan, they will be eligible to receive a refund for any payments they made during that time.

Only about 48% of students who paid off their loans during the pandemic say they were aware of the president’s loan forgiveness plan prior to taking the survey, perhaps contributing to their confusion about eligibility. In total, about a third (31%) of surveyed students are unsure if they are eligible for forgiveness under the plan.

One of the many controversies of President Biden’s loan forgiveness plan is that it does not do enough to address the main concern of college affordability. Other opponents believe the plan gives borrowers too much forgiveness and that it should be scaled back.

But more than a third of surveyed students (37%) say that the president’s plan didn’t go far enough to alleviate student debt. Only 22% of students disagree. Overall, students were most likely to be neutral on the matter (40%).

Millennial students are significantly more likely than Generation Z students to say they believe the plan didn’t go far enough to alleviate student debt (47% vs. 34%). White and BIPOC students are equally likely to agree (37%) on this question.

At the same time, student and college affordability ranks well behind other political issues among college students. Only 18% of overall respondents selected student debt as one of their most important election issues this year, making it the eighth most important response behind the economy, abortion, and several other key midterm issues.

Should Biden’s plan move forward as intended, it will eliminate roughly $430 billion of the $1.6 trillion in total student loan debt, according to the Congressional Budget Office. That’s approximately 25% of the total student loan debt held by millions of borrowers across the country, which is significantly more than what has been forgiven by any previous president.

Even as the administration continues to face legal pushback against student loan forgiveness, it’s clear that students feel they would benefit from the plan advancing.

* This figure combines respondents who said yes to “I currently have federal student loans I took out before June 30, 2022” or “I paid off my federal student loans during the pandemic-related payment pause that started in March 2020.”

The survey was conducted from September 28-October 3, 2022, and was fielded by Pure Spectrum. Survey participants included 1,002 respondents nationwide who were currently enrolled in or planning to enroll in an on-campus or hybrid undergraduate or graduate degree program at a college or university in the next 12 months. Respondents were 16-59 years of age and currently pursuing or planning to pursue an associate, bachelor’s, master’s, doctoral, or professional degree. The respondents for the survey were screened by various quality checks, including systems like Relevant ID, and responses were manually reviewed to ensure consistency and accuracy.