A core promise of President Biden’s presidential campaign in 2020 was federal student debt relief. According to the Department of Education, the average student graduates with 25 thousand dollars of debt. Additionally, Pell Grants now only cover about a third of college tuition, when they used to cover nearly eighty percent of tuition in the 1980s.
On Aug. 24, 2022, the Biden administration announced a plan to help with federal student debt relief, which includes some debt forgiveness. According to a fact sheet posted on the White House website, this plan will “provide targeted debt relief,” change the current loan system by cutting monthly payments in half, give credit towards loan forgiveness to anyone who worked or works as a public servant and helping to reduce the cost of college and holding schools accountable for boosting prices in tuition.
The first part of the plan, which can most affect EMU students and alumni, will provide some debt forgiveness. Borrowers will receive different amounts of forgiveness. Anyone who received a Pell Grant can receive up to $20,000 in forgiveness. Non-Pell Grant recipients can receive up to $10,000 in debt forgiveness. However, there are a few qualifications to receive forgiveness. Only anyone who makes more than $125,000 a year cannot receive any forgiveness. This cap is raised to $250,000 for married couples and families. According to the Biden administration, this means that no one in the top five percent of income will receive debt forgiveness. Additionally, the President has extended the pause on federal loan repayment through Dec. 31 of this year and payments will begin again on Jan. 1, 2023. By the time this pause ends, the Department of Education will have a simple application process available for debt forgiveness.
According to the Biden administration, if all eligible borrowers request relief, it could help up to 47 billion people and forgive the full debt of almost 20 million people. Many EMU students and alumni could be included in this group. Current Junior Caleb Stoltzfus says that he believes that this is a “good start.” He also said that he thinks that more can be done. Levi Myers, a current Sophomore, also believes that this is a good start but that colleges are making the price of college so high that students are in much higher debt than $10,000 or $20,000. He also states that he feels that this debt relief is much better for those who have smaller loans rather than those being crushed by larger loans. Jennifer Granados, an EMU Senior, is grateful for the student loan forgiveness because it could forgive about half of her loans.
According to the White House website, President Biden’s plan also includes “Make the student loan system more manageable for current and future borrowers by: cutting monthly payments in half for undergraduate loans,” and “fixing the broken Public Service Loan Forgiveness (PSLF) program by proposing a rule that borrowers who have worked at a nonprofit, in the military, or in federal, state, tribal, or local government, receive appropriate credit toward loan forgiveness.” Additionally, they will, “protect future students and taxpayers by reducing the cost of college and holding schools accountable when they hike up prices.” For more information on debt forgiveness, see the White House website or https://studentaid.gov/debt-relief-announcement/.
