President Biden Announces Student Loan Forgiveness

Student Loan Forgiveness

FACT SHEET: President Biden Announces Student Loan Relief for Borrowers Who Need It Most – The White House

There has been pressure put on President Biden to deliver on one of his campaign promises, to forgive student loan debt. At a press conference on Wednesday, President Biden announced his plan to offer loan forgiveness.
He offered a three-point plan that the Department of Education will roll out.

First, it will provide targeted debt relief. The Department of Education will provide up to $20,000 in debt cancellation to those that received Pell Grants. Those with non-Pell Grants will receive up to $10,000. However, there is a limit on how much you make to receive the loan forgiveness. You must make less than $125,000 for individuals or $250,000 for married couples to qualify. The administration emphasized that “No high-income individual or high-income household – in the top 5% of incomes – will benefit from this action.” Also, the pandemic-era payment freeze was supposed to end on August 31, but through this plan, it is extended through December 31, 2022.

Second, those with undergraduate loans will have their monthly loan payments cut in half. It will also correct the Public Service Loan Forgiveness Program. They will do this by making a rule “that borrowers that work in nonprofit, in the military, or in federal, state, tribal, or local government, receive appropriate credit toward loan forgiveness.”

The third part of the plan is to put in place to protect future students by reducing the overall cost of attending college. Schools that increase tuition rates will be held accountable. It is noted that President Biden will continue to push for an increase in Pell Grants; he wants them doubled and will continue to push for free college. As of this time, those two items are not included in the plan.

According to the White House statement, President Biden “believes that a post-high school education should be a ticket to a middle-class life, but for too many, the cost of borrowing for college is a lifelong burden that deprives them of that opportunity. During the campaign, he promised to provide student debt relief. Today, the Biden Administration is following through on that promise and providing families breathing room as they prepare to start re-paying loans after the economic crisis brought on by the pandemic.”

There are many that don’t agree with the plan.  Mitch McConnell being one of them.  He states, “President Biden’s socialism of student loans is a slap in the face to every family that has sacrificed to save for college, to every college graduate that pays off debt, to every American that has chosen a particular career path, or who has volunteered for service in our armed forces, in order to escape the burden of taking out more debt,” McConnell added. “This policy is shockingly unjust.

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John Nightbridge is a veteran reporter, researcher, and economic policy major from UCLA. Passionate about world issues and potential ways to solve them is a significant focus of his work. Writing freelance and reading the news are John's passions at work. Outside of work, it's all about sky diving, surfing, and stock market modeling.