Error by DOE Contractor Causes Confusion on Student Loan Relief

Millions of student-loan borrowers will soon receive an updated email on the status of their debt relief.

In late November, approximately 9 million borrowers received an email from President Joe Biden’s Education Department with a subject line that stated: “Your Student Loan Debt Relief Application Has Been Approved.” However, that subject line was incorrect, Insider has learned — it was simply supposed to inform borrowers that their applications had been received with the subject line: “Update on Student Loan Debt Relief.”

This error was made by Accenture Federal Services, a contractor of the Department of Education, While the content of the email was accurate and provided borrowers an update that debt relief is currently held up in court and loans cannot be discharged at this time, Accenture has acknowledged that the header was caused by human error and shall be sending new emails with a corrected subject line to those impacted borrowers in the coming days.

The Department of Education has previously indicated that 26 million student-loan borrowers had already submitted applications for debt relief. However, since October, the option to submit an application has been closed due to two legal decisions so far that have blocked the implementation of the relief. The first ruling came from a Texas judge last month who said Biden’s plan to cancel student debt is illegal, and just days later, the 8th Circuit Court of Appeals decided the temporary pause it had placed on the relief in October will remain in place. The Biden administration has now moved to have the Supreme Court review the issues raised by the 8th Circuit.

In addition, in light of the lawsuits, President Biden recently extended the pause on student-loan payments through June 30, or whenever the lawsuits are resolved — whichever comes first. The administration also continues to express confidence that it will prevail in court and stands behind the authority it used under the HEROES Act of 2003 to enact one-time debt relief for millions of borrowers.