Student Debt: Biden ‘Not Considering’ $50k Loan Forgiveness but Will Look at Other Options
Federal student loan borrowers will have to wait a little longer to find out how President Joe Biden intends to deal with mounting student debt in the United States. One thing they shouldn’t expect is for Biden to forgive $50,000 in debt per borrower, as some had hoped.
In a Thursday speech at the White House, the president said he is “not considering” $50,000 in debt reduction, CNBC reported.
“But I am in the process of taking a hard look at whether or not there will be additional debt forgiveness,” he added. “I’ll have an answer on that in the next couple of weeks.”
Biden didn’t offer any details on what his debt forgiveness plan might look like. As a presidential candidate in 2020 he voiced support for $10,000 in forgiveness per borrower, but that idea has been put on the back burner since he moved into the White House.
As CNBC noted, canceling $10,000 per borrower would erase $321 billion in federal student loan debt. Nearly 12 million borrowers would have their debt completely eliminated, but roughly 70% would still be left with some form of student loan debt.
As GOBankingRates previously reported, Biden did not include forgiveness or any other direct student loan relief in his $5.8 trillion budget proposal. That’s despite the fact that some lawmakers have urged him to support a comprehensive loan forgiveness program.
Senate Majority Leader Chuck Schumer (D-N.Y.) has been a vocal proponent of canceling $50,000 or more per borrower. U.S. Rep. Alexandria Ocasio-Cortez (D-N.Y.) wants to go even further by canceling all federal student loan debt.
But most Republicans and some Democrats oppose these kinds of sweeping policies, so it might be hard for Biden to enact them unless he issues an executive order.
The Biden administration did recently cancel $7 billion in federal student loan debt for about 350,000 borrowers with disabilities. But much of his attention has been focused on extending the student loan payment moratorium that went into effect during the early days of the COVID-19 pandemic. The president recently extended the moratorium until Sept. 1, 2022 from an earlier date of May 1.
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