What are the income limits for student loan forgiveness?
President Biden is “considering dealing with some student loan debt reduction” but with income limits that would exclude higher-earning Americans.
President Biden’s campaign pledge to cancel up to $10,000 in student loan debt for Americans may be getting closer. Although the specifics of who exactly would benefit from the action have not been presented, he has said that he’ll lay out his plan in a couple weeks.
However, his press secretary Jen Psaki told press aboard Air Force One that the president is “taking steps or looking at steps to help people making less than $125,000 a year.” Despite a constant push from members of his party, Biden has reiterated that he is not willing to cancel $50,000 in student loan debt as has been urged.
Also see:
- What are the negatives of student loan forgiveness?
- Who will benefit from student loan forgiveness?
- Which government agencies have to accept the student loan forgiveness for it to become official?
- Who is eligible for the new student loan forgiveness?
- More than 110,000 people can benefit from student loan forgiveness
- Can federal student loans be forgiven after 10 or 25 years?
After delaying Biden is taking action
Biden has been hesitant to use executive action to cancel student debt, instead urging Congress to pass legislation to provide borrowers with relief. White House aides told Bloomberg that Biden’s team is split on the merits of broad forgiveness.
The biggest worry expressed by deficit hawks is that it could worsen inflation which over 40 percent of voters already blame on the president. The rising cost of just about everything is expected to take a toll on the Democrats in November’s midterm election results.
The high inflation has helped to bog down the passage of the rest of his political agenda to invest in families and make the US economy carbon-free. With a lack of momentum in Congress, Biden told the Congressional Hispanic Caucus in late April that he was ready to use executive action to provide broader student debt relief.
His administration has already canceled $17 billion in student debt for around 725,000 borrowers. The Department of Education recently announced that Federal Student Aid will conduct a one-time adjustment of loans for borrowers who were improperly steered into forbearance. It is estimated that this measure will result in the immediate debt cancellation for tens of thousands and move millions more closer to debt forgiveness.
Student loan debt forgiveness has strong support
A recent poll from Morning Consult and Politico shows that Americans, even those without student debt, strongly support canceling some student debt. The survey showed that 32 percent of respondents favor forgiving some loan forgiveness for Americans, split evenly among those who support such a measure for all and only for low-income borrowers.
Another 32 percent supported forgiving all student debt, with 19 percent considering that the federal government should cancel the outstanding balance for all Americans. Of respondents, 80 percent held no student debt.
Student loans on hold until September
Student borrowers have had a holiday from paying back their student loans or worrying about interest accumulating since March 2020. The freeze on payments has been extended six times, most recently Biden extended the moratorium until 31 August 2022. Further continuations of the measure have not been ruled out yet.