Making a loan is a sunk cost.
Forgiving the loan means you will not get income from that cost.
But that means you don't have the income you expected. You can't spend as much on other things as you intended. You're pulling the standard leftist handwave of pretending something sufficiently dispersed ceases to exist.
All lenders always risk that they will not be paid back. The risk is reflected in the interest charged. In my example, I was charging 5% interest which is higher than today’s mortgage rates or car loans.
Failure to repay a loan generally is reflected in a credit score.
You’re looking at education as a private good rather than a public good. And as job training rather than education. Society benefits from a well educated populace. Better educated people are better able to be informed on issues of the day. They tend to be happier and healthier people and, regardless of whether or not they work in the field in which they earned their degree, they tend to earn more money. They tend to make better choices in life. All of these things lead to a more stable, more productive society.
I see this as a good thing.