You Didn’t Do it Joe! Federal Student Loans Restarting In 2022.
We can all agree that we dread hearing these two words, “Student Loans.” Since the start of the pandemic, the government has paused student loan payments for all citizens which brought great relief to many of us. If you can remember, during the presidential election, Joe Biden pledged to forgive a minimum of $10,000/person of federal student loans to help with the debt crisis. A lot of us want to understand why President Biden is not holding up to his promises. Take a look below on what you need to know about his decision and how it affects your student loans:
Since March 2020, Congress has passed the Cares Act totaling in $2.2 Trillion dollars that included significant student loan relief for federal student loan borrowers. Since Biden’s election, he extended the student loan relief twice through January 31, 2022.
Despite the push by Democrats to cancel approximately $1.7 trillion of student loan debt, it is noted that student loan forbearance due to the pandemic resulted in more than $110 billion of student loan cancellation for borrowers. The U.S. Department of Education approximates that $5 billion of interest savings were accounted for within the 22 month period.
Reports state that Biden has cancelled student loans for public servants, borrowers with a total and permanent disability, and borrowers who were misled by their college or university. In addition, Biden states that there will be changes to the student loan forgiveness initiative which will occur independently of student loan relief being extended. So there is potential that there will be student loan forgiveness steps but only to the borrowers that will meet the criteria. (IMO - this is such an unfair reasoning)
There are other economic priorities besides student loan forgiveness. It’s been reported that the amount of student loan borrowers only represent about 14% of the approximately 330 million Americans. Despite the financial benefits of extending the student loan relief, Biden believes that he must balance the other economic priorities such as combatting inflation, controlling the Covid-19 pandemic, rebuilding the economy, considering additional stimulus, and other items.
While President Biden’s change in direction comes as a surprise to most Americans like myself. It is important to research and find ways that will help our situation no matter how little it may be. Trust me, it is very tough when people of power use things to attract more voters but that is the way the system works in America unfortunately. In the meantime, it won’t hurt to check out ways to get your student loan payments reduced or maybe even forgiven. Please reference the links below for information on how you can qualify to get automatic student loan forgiveness or at least get your payments adjusted based on your income:
https://studentaid.gov/manage-loans/forgiveness-cancellation
https://www.usatoday.com/story/money/personalfinance/2021/10/07/student-loan-forgiveness-psl-loan-who-eligible-how-apply/6034053001/
For Texas residents:
https://www.studentloanplanner.com/student-loan-forgiveness-texas/
