I take it that this decision was based on the idea that a President does not have the authority to forgive debt, not on the fact that picking and choosing who has debt relief is not Constitutional.
Could a bill such as this be considered Constitutional if it was passed by Congress?
I think it would not be, but if RATs are in control, who knows?
Yes, congress could forgive the debt via passing a law to do so. In addition to the government being the creditor, the constitution places a prohibition on states passing laws to modify private contracts, but there is no such prohibition on the federal government from doing so.