Photo by: Alex Wong/Getty Images
President Joe Biden is making a big announcement regarding a hot promise he made while running for president.
President Biden announced fresh measures on Wednesday, August 24th to address student loan debt, including extending the payment freeze one last time through the end of the year and forgiving up to $20,000 for those eligible for the relief.
“In keeping with my campaign promise, my Administration is announcing a plan to give working and middle class families breathing room as they prepare to resume federal student loan payments in January 2023,” he tweeted, as he announced his plan.
Following last-minute talks at the White House with stakeholders and lawmakers prior to when payments were scheduled to restart at the end of this month, the President announced his comprehensive approach to student loans.
Borrowers earning less than $125,000 per year, or couples earning less than $250,000 per year, will be eligible for up to $10,000 in loan forgiveness under the plan.
Another $10,000 in aid is available to students who are Pell Grant recipients, which are awarded to those with the greatest financial need.
“An entire generation is now saddled with unsustainable debt in exchange for an attempt at least at a college degree,” President Biden explained.
Photo by: Alex Wong/Getty Images
He continued.
“The burden is so heavy that even if you graduate, you may not have access to the middle-class life that the college degree once provided.”
Senior administration officials who described the terms of the plan on a call with reporters said that future students will not be eligible for debt relief, but current students will.
Additionally, some loan payments will have a 5% cap on monthly income.
It wasn’t long for the news to cause a field day on social media.
“President Biden’s student debt plan will forgive the remainder of my undergraduate loans. I’m a first-generation college graduate, a Pell grant recipient, and as of today a Master’s student at Georgetown. This is what economic mobility looks like. Thanks Joe! 🙌🏾,” one person tweeted.
Another person stated, “I was a working student and after graduation, I always paid a little extra to knock down my principal balance… this morning my student loan balance was 7k. Thanks to President Biden, I’m debt free. #studentloanforgiveness.”
However, this plan of putting a student loan forgiveness course in action has received backlash.
“We can fund Ukraine but not eliminate student loan debt the basis of the 2020 campaign….. Other countries keep getting money from us and we can’t eliminate #studentloans! The math ain’t MATHING @POTUS! #education #college #studentloanforgiveness,” one person said.
Comments also discuss why people need to use their money to wipe student loans.
“Remind me again why myself along with millions of others that are in debt trying to keep our family going, is going into more debt by paying others student loans?,” one person tweeted in response to the news.
Another person exclaimed, “Just listen to President Biden give money to college students who had loans. How dare you give my money away. As a college graduate who paid for schooling with GI Bill and loans. Paid it all back.”
In addition, the president has delayed student loan payments until the end of the year. According to the president and the Education Department, this is the final extension of the pandemic-era hiatus.
Nearly 8 million debtors, according to the Education Department, would have their debt immediately forgiven; others will need to seek relief.
Borrowers can sign up to receive notifications when the application is available, according to the Department of Education.
The suspension of student loan repayments started under the Trump administration at the start of the pandemic, and since President Biden took office, it has been suspended a total of four times.
According to a Financial Health Network analysis from April, the zero percent interest rate delay has helped borrowers of federal student loans avoid paying more than $1.5 billion in interest each month.
Are you looking forward to getting your student loans forgiven? Tell us down below!
