Student loans: red, white and blue
If you have student loans, you may encounter red, white, and blue.
Here’s what you need to know.
If you have student loans, you may be wondering what the future holds for your student loan debt. If the answer is uncertainty, welcome to the club. Student loan forgiveness and student loan payment suspension, in particular, can be a priority. President Joe Biden is weeks away from announcing potentially billions of dollars in student loan forgiveness for millions of student borrowers. However, student borrowers do not know if they qualify or how many student loans they could take out.
Student Loan Forgiveness: When Will Biden Forgive Student Loans?
First, you might be wondering when Biden will cancel student loans. Biden will likely announce his decision on whether or not to forgive student loans by August 31, 2022. As a presidential candidate, Biden has called on Congress to forgive up to $10,000 in student loans for student borrowers. However, as president, Biden has focused on targeted student loan forgiveness rather than large-scale student loan relief. For example, Biden has forgiven over $30 billion in student loans. That includes $6 billion in student loans that Biden canceled for 200,000 borrowers. Biden also canceled $8.1 billion in student loans for public servants. If Biden cancels student loans, he will most likely cancel $10,000 in student loan debt. That said, progressive members of Congress have renewed their push for Biden to forgive up to $50,000 in student loans. Biden could also impose an income limit, which could mean fewer student borrowers will be eligible for student loan relief.
Student loan payment break: to extend or not to extend
Second, student borrowers want to know if student loan payments will resume on September 1, 2022. Currently, the student loan payment pause will end on August 31. student loan repayments will resume. Student borrowers are no longer required to make a single student loan payment since March 2020. Why? Congress passed historic student loan relief under the Cares Act, the $2 trillion stimulus package President Donald Trump signed into law. Trump and Biden have extended the student loan payment break six times. However, the Biden administration has remained relatively silent on any potential extension of the student loan moratorium. US Education Secretary Miguel Cardona has indicated that Biden may extend student loan relief. However, Biden has not commented publicly. For now, student borrowers should prepare for the restart of student loan repayments. There is no guarantee that the student loan payment break will be extended. Here are some great ways to start paying off student loans: