Daniel Gray and his husband, Douglas, and their dog.
Courtesy: Daniel Gray
On Oct. 23, the day after Daniel Gray’s 56th birthday, he received an email that made him feel like he was dreaming: The U.S. Department of Education would forgive his more than $170,000 student loan balance.
“I could not believe it,” Gray said. “This is the first time I’ve been without debt since I’m 18.”
Yet the relief should not have been so surprising.
Gray began paying his student loan debt in the 1990s and was eligible for the loan cancellation under the terms of his income-driven repayment plan. IDR plans lead to loan erasure after a certain period, typically 20 years or 25 years. But, like many borrowers, Gray was worried by reports that the relief was becoming harder to access under the Trump administration.
“Because of what’s been going on, it was unclear whether they’d get forgiven,” Gray said.
Recently, many student loan borrowers have been left doubting if they’ll get the loan cancellation to which they’re entitled, said higher education expert Mark Kantrowitz.
“When borrowers worry about whether the Trump administration will renege on the student loan forgiveness promised by the federal government, it places them under extreme financial and emotional stress,” Kantrowitz said.
The U.S. Department of Education did not respond to a request for comment.
Loan forgiveness becomes uncertain under Trump
Earlier this year, the Education Department stopped forgiving the debt of borrowers in two long-standing student loan repayment plans, the Income-Contingent Repayment plan, or ICR, and the Pay As You Earn plan, or PAYE. It also temporarily paused debt forgiveness under the Income-Based Repayment plan, or IBR.
More than 12 million student loan borrowers are enrolled in one of the Education Department’s IDR plans, according to Kantrowitz.
But then, in October, there was a major victory for borrowers: The Trump administration agreed to resume clearing people’s debts under ICR and PAYE, as a result of a lawsuit brought by the American Federation of Teachers. That same month, eligible borrowers enrolled in IBR also began to see their debts canceled again.
The AFT contended that Trump officials were blocking borrowers from their rights mandated in their loan terms.
“We cannot say for sure, but it is possible that the AFT lawsuit prompted the discharge,” said Weena Sanchez, a student loan counselor at the Education Debt Consumer Assistance Program in New York, a nonprofit, about Gray’s student loan forgiveness. EDCAP worked with Gray on his request for the relief. Gray had earned the loan cancellation by May 2024, according to his loan forgiveness statement.
“We’ve heard of other clients receiving similar notices,” Sanchez said.
But student loan borrowers continue to get their debt excused amid unprecedented changes at the Education Department.
The Trump administration announced this week that it will transfer much of the Education Department’s programs to other agencies, a move experts say is part of President Donald Trump’s directive to dismantle the agency. Education Department officials are also exploring options to sell portions of the $1.6 trillion federal student portfolio to the private market, Politico reported in October.
A lifetime vow of poverty should not be part of the bargain.
Mark Kantrowitz
higher education expert
Whatever changes lie ahead, it’s important for borrowers to remember that the original terms of their student loans, spelled out in their Master Promissory Note, cannot change in the middle of repayment, Kantrowitz said. When borrowers signed that agreement, any programs that were in existence at the time, including repayment plans that conclude in loan forgiveness, must remain available to them, by law.
Since student loans can’t be discharged in normal bankruptcy proceedings, like other types of debt, borrowers “depend on there being a light at the end of the tunnel,” with the government’s forgiveness, Kantrowitz said.
“When a low-income student is forced to borrow to pay for college, a lifetime vow of poverty should not be part of the bargain,” he said.
Student loan forgiveness ‘the only way out’
For some 30 years, Gray says his student loan debt weighed on him. He graduated in the mid-1990s from the University of California, Santa Barbara, with a degree in film studies and began working technical jobs in video and television production.
But in the following years, he says, he grappled with substance abuse issues and clinical depression. As a result, his career took a hit, and Gray struggled to keep up with his monthly student loan payment, he said. Originally, he borrowed roughly around $30,000, but his balance steadily grew due to interest charges.
“This system is designed for students to graduate, get good jobs and start paying,” Gray said. “But what about for those of us who don’t get our lives together until we are 37 or 38?”
By then, he said, his debt was already nearing six figures. By the time his debt was canceled by the government in October, his balance had spiraled to more than $170,000.
“I couldn’t believe I had allowed it to get to this point; I felt incredibly guilty and ashamed,” Gray said, but he also “felt like the whole situation was engineered to take advantage of the borrower.”
In 2011, Gray got a job offer at a television studio in Brazil. Frustrated with the cost of living in the U.S. and hoping for a major change, he made the move to São Paulo. He’s lived in Brazil ever since. He met his now-husband, Douglas, a chef, there. The couple live close to the beach and take their dog for long walks every day.
The biggest change Gray has felt since his student debt was wiped away is psychological: “I suddenly feel like I can relax,” he said.
“It’s easy for people to say, ‘Why don’t people just pay them off? What’s the big deal?” Gray said, about his student loans.
But he went on: “It reached a point where it was beyond control. It seemed impossible. Student loan forgiveness is the only way out for a lot of people.”
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