The Biden administration has introduced a slew of initiatives intended to provide relief to millions of student loan borrowers struggling to manage tens of thousands of dollars in debt. Most recently, the Revised Pay As You Earn (REPAYE) program will eliminate the accrual of unpaid interest if borrowers make their monthly payments, reduce monthly payments to $0 for borrowers with undergraduate loan debt making $30,600 or less (or below $62,400 for families of four), and cut student loan payments in half for those who still have monthly payments above $0. But access to these student debt relief programs remains a pressing question for currently and formerly incarcerated borrowers. 

While high interest rates, credit reports, and wage garnishment have plagued borrowers from all walks of life, the experience of living with and managing student loan debt is uniquely burdensome for borrowers whom the carceral system has caught. Debt relief for incarcerated borrowers who took on loans before their sentence is not readily available. The maze of restrictions on communications inside makes applying for that relief or even making loan payments incredibly difficult, if not impossible. For formerly incarcerated borrowers who have returned home, the collections process can hamper people’s efforts to successfully reenter their lives and sow harm for their loved ones—a hallmark feature of many collateral consequences of incarceration. 

Despite how the carceral system inevitably upends people’s lives, including their ability to manage student debt, the needs and concerns of incarcerated and formerly incarcerated borrowers continue to be overlooked by relief efforts. And the ongoing unwillingness of policymakers to acknowledge this oversight only adds to the barriers and burdens borne by those already impacted by inequitable access to education and economic mobility rooted in racist policies.

Incarcerated borrowers face multiple challenges to access student debt relief programs 

In 2022, President Joe Biden announced the launch of Fresh Start initiative, which temporarily restores those with defaulted loans into good standing, eliminating the impact of default on borrowers for a temporary period after the student loan repayment pause ends. Incarcerated borrowers with loans in default now have the opportunity to enroll in Second Chance Pell programs that have provided needs-based Pell grants to incarcerated individuals in 42 states through partnerships with around 130 colleges and universities since 2015. They can also now consolidate their loans, which may help them more easily get out of default. However, incarcerated people with preexisting loan debt may not benefit as fully from these initiatives because many of these programs don’t account for the severe restrictions on communications that those inside have to abide by.

“Fresh start, cancellation, and income-driven repayment all put the burden on borrowers to find out about the opportunity and to go through an application process or, in the case of Fresh Start, to be able to call their servicer and indicate that they want to participate in the program,” said Abby Shafroth, staff attorney at the National Consumer Law Center (NCLC). “That’s a huge barrier for incarcerated borrowers.” 

Shafroth also serves as director of the NCLC’s Student Loan Borrower Assistance Project. This year, the group hopes to ensure that Biden’s student debt relief programs and newly proposed repayment plans will actually benefit borrowers and that borrowers are prepared and equipped with the necessary information to address the debt after the payment pause ends. Last fall, NCLC released a comprehensive report, “Collection At All Costs,” outlining some of the barriers and potential opportunities for incarcerated student loan borrowers. 

For incarcerated borrowers, Shafroth noted that there are current and newly proposed programs that have the potential to offer relief, but “the problem is actually connecting the people who are incarcerated with these programs.” 

When someone with student debt is incarcerated, collection of that debt doesn’t immediately pause, but there are significant—albeit relatively little known—options for relief:

• The government can pause collections until after anticipated parole or the earliest possible release date for those incarcerated nine months or fewer; 
• The government can pause collections until the earliest possible release date for those incarcerated between nine months and 10 years; 
• The government can write off all defaulted federal student loans for those incarcerated 10 years or more.

As helpful as these relief options may be, their success is stymied by the fact that they are not automatically granted to borrowers who qualify. Instead, people must first apply, which requires unraveling a puzzle of preconditions, including informing the Department of Education of their incarceration and expected release date or date of eligibility for parole by mail on the penal institution’s letterhead, with a prison official’s signature. The letter must also include sensitive information such as the borrower’s social security number, date of birth, and inmate number—details usually restricted from prison correspondence. 

Similarly, while some incarcerated borrowers are eligible for Biden’s one-time student debt cancellation of up to $20,000, filling out the form required to apply for this cancellation requires internet access. Even facilities that grant internet access often allow only a small handful of websites, which may or may not include the sites hosting the form. 

In short, incarcerated borrowers’ ability to successfully complete these applications or make a loan payment rests on being unencumbered in communicating with those outside the prison walls, a task that the penal institutions are notorious for making difficult. Incarcerated people have to navigate a maze of rules and requirements including: 

• Email obstacles: While many penal institutions grant access to email via the prison telecom service J-Pay, J-Pay users cannot send or receive email from users from other email domains. Those on the outside who wish to communicate with J-Pay users inside must create their own account on the platform, severely restricting the ability of incarcerated borrowers to easily send emails to their loan servicers for assistance.  
• Pre-approved call lists: Incarcerated individuals can only place outgoing calls to select numbers on their pre-approved “call list,” and many institutions prohibit toll-free or “1-800” numbers from being included on these lists. 
• Time restrictions on phone calls: Many facilities have a 15-minute limit for phone calls, which often doesn’t even cover the wait times for calls with loan servicers.
• High cost of communicating: Both calls and paper stamps for physical mail are set at egregiously high prices that many incarcerated individuals struggle to pay. 
• Internet black-lists: While some facilities allow incarcerated individuals access to tablets or computers, there are only a small handful of webpages that can be connected to, which often doesn’t include Department of Educations sites where borrowers would be able to access their personal loan accounts or information about relief. 

Limited funds and access to personal finance also pose considerable barriers for borrowers inside seeking to manage their debts. Incarcerated borrowers are not automatically enrolled in income-driven repayment (IDR) plans, and those seeking to get out of default through a rehabilitation process must first make nine consecutive payments of no less than $5. However, even these $5 payments can be costly for those inside given the notoriously low wages they are paid for their labor. 

Potential solutions aren’t lacking, but political will is

While there are not many funds that can be immediately collected from incarcerated people while inside, there are ways that defaulted loans can impact their financial stability or that of their families. For example, spouses of incarcerated borrowers can have their tax refunds or earned income tax credits—payments designed to help support low-income families and children—seized by loan servicers while their loved one is still inside. 

Furthermore, the burdens of lingering loan debt become even more acute once borrowers are released and return home. Wage garnishment, impact on credit score, and seizure of anti-poverty tax credits and social security payments profoundly impact a person already experiencing heightened levels of financial vulnerability. This is particularly true for those seeking to rebuild their lives through obtaining housing, jobs, benefits, or schooling—and must fund that education via additional loans. 

The struggles can be difficult enough for individual adults to bear, but Shafroth said that a lesser discussed but particularly important impact of student loan debt on the formerly incarcerated is the generational toll it can have on a family’s financial security. Shafroth noted a growing amount of research around how children are impacted by parents’ incarceration. 

“There’s a really high number of people who are incarcerated who are parents of dependent kids [and] that makes this all the more important, particularly when we’re talking about the vulnerability of child anti-poverty payments, like the earned income tax credit and the child tax credit, to be seized in full to collect on defaulted student loan debt,” Shafroth said. “We’re not just punishing the individual who’s been incarcerated, but [we’re also punishing] their kid who already is suffering and has lost opportunity to spend time with their parents, lost income to their family, and lost connection [to a stable home].”

Advocates say that increasing access to resources and information for incarcerated borrowers could potentially offset these challenges—meaning that prisons should remove internet restrictions, increase time allotments for phone calls, and automatically allow 1-800 numbers to be included on call lists. Some advocates, such as those with JSTOR’s Access in Prisons Initiative, are encouraging state departments of corrections to white-list Department of Education webpages, thus making relief applications and information about relief options more widely available to those inside. 

Shafroth also says there could be a greater effort on the part of prison administrators to establish counseling programs that offer support around financial issues for incarcerated borrowers. Such programs could help borrowers take stock of what debts they have, analyze their families’ financial situations, identify relief programs that they may be eligible for, and design financial plans to execute upon their release. 

The NCLC report also outlines recommendations for how the Department of Education can help incarcerated borrowers more easily manage their loans and take advantage of existing relief options. Among these recommendations are canceling federal loans for borrowers incarcerated for over five years and cross-referencing federal student loan borrowers with governmental or private databases that compile incarceration information so that incarcerated borrowers can be automatically enrolled in income-driven repayment plans and other relief programs without having to apply.

However, implementing these changes depends on a level of political will and determination currently lacking among policymakers and legislators. 

“There’s now a money problem [as] the new Congress is not interested in providing as many resources to the Department of Education,” said Shafroth. “It’s going to take some resources to set up a system that will allow [debt relief programs] to automatically identify which student loan borrowers are incarcerated and enroll them in the best benefits and safety net protections available.”

The formerly incarcerated and loan debt 

As organizers and advocacy groups continue to press the Biden administration’s expressed commitment to addressing the burden of student loan debt, some remain aware of the fact that the additional hurdles that many incarcerated borrowers and aspiring incarcerated students must contend with are a direct result of the crime bill that Biden spearheaded almost three decades ago.

For almost 30 years, incarcerated students were denied access to Pell grants via the Violent Crime Control and Law Enforcement Act of 1994, commonly referred to as the 1994 Crime Bill, of which then-Sen. Biden was a primary architect. Additionally, college-in-prison programs shrunk from over 300 to roughly 12 in the decade that followed. It wasn’t until 2020 that federal legislation was passed to restore access to Pell Grants for all incarcerated students, beginning in the fall of 2023. 

That history has inspired new questions and potential demands for the Biden administration to further address the needs of currently and formerly incarcerated people. For example, what about incarcerated students who were denied Pell Grants in the past and either had to turn to predatory, private loans to fund their education or decide to forgo college altogether? How can the Biden administration appropriately redress this harm and others that resulted from federal legislation that Biden championed?

Again, much depends on the amount of political will advocates are able to muster. Shafroth acknowledged that, like many other issues related to incarcerated individuals, there is not always a willingness to find solutions to problems stemming from incarceration because the people who are most impacted are often unable to voice their concerns as an influential voting bloc.

“Figuring out ways to elevate the importance of the issues impacting incarcerated people and their families is a struggle,” said Shafroth. “I think there’s a lot of people who understand the problem and who think that we should address it, but moving from something that should be addressed to something that we will prioritize addressing is a challenge.”