Government doesn’t send checks to forgive student debt

The Biden administration has frequently touted its efforts to forgive student debt. Most recently, on Feb. 21, 2024, the administration announced it has forgiven $138 billion in student loans for 3.9 million borrowers since President Joe Biden first entered office.

VERIFY reader Diane emailed us to ask if borrowers receiving forgiveness are getting checks, and if borrowers have to use that money on their student loans if they do receive checks.

Does the federal government send checks for student loan forgiveness?

No, the federal government does not send checks for student loan forgiveness.

When the U.S. Department of Education forgives someone’s federal student loan, it simply erases the remaining repayment balance on that loan. It does not issue checks for forgiveness. 

When the government forgives a borrower’s student loan debt, it rids the borrower of their obligation to repay all or a portion of their loan, the Education Department’s Federal Student Aid website says.

If the government forgives the full amount of your loan, you won’t have to make any more payments on that loan, Federal Student Aid says. If only a part of your loan has been forgiven,  the amount you have to pay will be reduced and you’ll still need to pay the remaining balance.

Or as Debt.org, a debt information resource, puts it: “Forgiveness means all or part of your student loan is wiped away. Poof!” 

There are a couple instances where borrowers could receive checks from the Education Department, but those are for overpayment refunds or loan cancellations. 

One instance is if the Education Department completely cancels a borrower’s student loan that they have already partially or fully paid off, the National Consumer Law Center (NCLC) says.

This could happen for a borrower who is granted a closed school discharge, the NCLC says. When the Education Department grants this kind of discharge, it cancels the loans the person borrowed to attend the closed school, gives the borrower a refund of payments made on those loans and deletes any negative credit history associated with those loans from the borrower’s credit report.

The Department of Education may also send refunds to borrowers who have overpaid on student loan debt that has been forgiven. For example, borrowers in the Department of Education’s income-driven repayment program have received refunds for payments made long after they were eligible for forgiveness.