President Biden’s program to erase large amounts of student loan debt attracted some criticism immediately after it was announced in August and, more recently, several lawsuits. Scammers have targeted borrowers. The administration has reduced the number of people eligible for forgiveness. All before an application form for debt forgiveness even exists, the New York Times reported. Many of the details were not yet complete when the plan, which was hailed by progressive Democrats and would forgive up to $20,000 in debt for individuals making under $125,000, was unveiled. The goal of the program was to instantly improve the finances of millions of Americans. For those outside the White House, the reality has been much more chaotic. Department of Education officials are racing to create the application and get a public information campaign up and running without substantial additional resources, according to several people familiar with the process. White House officials stress they are meeting often and across departments to get the form completed in October. Still, activists, borrowers and loan servicers worry that the program — the most costly executive action in history — might undergo more changes if problems continue to mount. “It’s too soon to say that they’re doing anything wrong because we haven’t even seen the form come out,” said Natalia Abrams, a founder of the Student Debt Crisis Center, a nonprofit advocacy group. The confusion around applying for loan forgiveness — including questions about changes in income — has amplified calls from Ms. Abrams and others for the administration to dispense with applications and automatically forgive the debt of those who qualify for the program. But that would leave the plan open to legal challenges: Opponents of automatic debt relief say that borrowers in some states would be forced to pay taxes on the forgiven debts. Some borrowers have been excluded without much notice: On the same day officials in six Republican-led states filed a lawsuit accusing Mr. Biden of abusing his power and acting unlawfully, the administration updated eligibility guidance to say that borrowers whose federal loans are privately held were no longer part of the program. The effort was no coincidence — eliminating eligibility for those students could make it harder for a Republican attorney general to successfully attack the entire program in court. There are other challenges: Conservatives have assailed the program’s price tag. Last week, when the news came that the plan could cost around $400 billion, with the bulk of the effects to the economy felt over the next decade, administration had an unusual line of defense. The estimate, by the nonpartisan Congressional Budget Office, said that as many as 90 percent of the 37 million eligible borrowers would apply, but White House officials suggested the price of the program was likely to be lower because not all who were eligible would participate.
