Biden To Cancel $10,000 In Student Loan Debt And Offer Forgiveness

President Biden is expected to announce $10,000 in student loan cancelation for each borrower and offer loan forgiveness for people making under $125,000/year, and extend the student loan payment freeze.

CNN reported:

White House officials have been weighing — and leaning toward — the cancellation of up to $10,000 in student loan debt per borrower tied to an income threshold, with an official announcement set for Wednesday, CNN has learned.

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According to multiple sources familiar with the discussions, the plan is designed to offer the forgiveness to individuals who earn less than $125,000 per year. It is not clear that a final decision on the details of the announcement has been made, and there could always be 11th-hour changes.

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In addition to that baseline of student loan debt forgiveness for individuals who fall under a certain income level, administration officials have also recently discussed the possibility of additional forgiveness for specific subsets of the population, according to sources familiar with internal discussions in the administration.

Based on CNN’s reporting, it appears that the terms of the student loan forgiveness are still flexible, but there will be $10,000 in student loan cancelation and a payment freeze for borrowers.

Biden and Democrats in Congress have been engaged in a silly standoff, where the White House wanted legislation to cancel student loan debt, and Democrats in Congress wanted the White House to take action.

It looks like Democrats in Congress won, but nothing is stopping House and Senate Democrats from going beyond Biden’s executive action. The repayment freeze continuation will bring some welcome peace of mind to borrowers, but the real key for the future is the forgiveness plan, which could liberate lower and middle-income borrowers from a crippling future of student loan debt.