Is student loan forgiveness finally on the way to help the millions of Americans looking for assistance? According to a report by The Washington Post, the Biden administration plans to cancel $10,000 in student debt per borrower. The move would be consistent with the President’s campaign promise in 2020.
With the new plan, there will be income limits. The Biden administration’s forgiveness plan would apply to Americans who earned less than $150,000 in the previous year or less than $300,000 for married couples filing jointly, two of the people told the Post. A study by New York Federal Reserve economists, forgiving $10,000 per student would amount to $321 billion of federal student loans and eliminate the entire balance for 11.8 million borrowers, or 31 percent.
Biden was reportedly going to announce the move at the University of Delaware’s commencement this weekend, but decided to hold off with respect to the elementary school shooting tragedy in Texas. There is a current pause on federal student interest and payments, which would expire at the end of August. No word has been given if the Biden administration plans to resume them after the period ends.
Senate Republicans have planned to introduce a bill to stop President Biden’s efforts to forgive any type of student loan debt with few exceptions. With a Democratic majority, the measure is doubtful to go anywhere. Many people and representatives calling for up to $50,000 of debt to be forgiven might be upset with the news, but this isn’t a final measure. Also, there are some legal questions about much student debt the President can forgive at a time through executive action. Biden has asked Congress to pass a bill forgiving debt that he could sign to get around this.