Here's What You Need To Know About President Biden's Latest Student Debt Cancellation Plans
President Joe Biden announced a sweeping new round of student-debt cancellation measures at a Monday appearance at a community college in Madison, Wisconsin, aiming to provide at least some student debt relief to nearly 1 in 10 Americans.
Specifically, the administration intends to, among other things, cancel interest payments for some 25 million Americans who owe more money in student debt now than they did when they first took the loans out; cancel the debts of over 2 million Americans who are eligible for debt forgiveness through federal programs like the SAVE Plan but are not yet taking advantage of it; and forgive the loans of about 2 million Americans with student debts that are older than 20 years. Combined with prior measures, Biden’s plans mean he will have reduced student debt for 30 million people.
“When I think about all the possibility and all the potential we can unlock when young people see that they can afford and access higher education, I think this work is nothing short of transformative,” Secretary of Education Miguel Cardona told reporters on a press call Sunday night. “That’s why we’re unapologetic about this fight. Student loan forgiveness isn’t only about relief for today’s borrowers. It’s about social mobility, economic prosperity and creating an America that lives up to its highest ideals.”
The administration’s proposed interest cancellation alone would have sweeping effects. Households of all incomes would be eligible for up to $20,000 in forgiven interest payments, and two-person households making up to $240,000 would be able to have their entire accrued interest forgiven regardless of size.
Overall, due to this newest set of changes, the Biden administration estimates that more than 10 million people would get over $5,000 in debt forgiven, including 4 million people who would have their outstanding debts entirely forgiven.
The 30 million people affected reflects the sum of those reached by Monday’s proposals and the 4 million people who have already received more than $143 billion in relief. The biggest chunk of borrowers already benefiting from relief are public-service workers in the government or nonprofit sectors who qualify for loan forgiveness under a Bush-era law.
As with any new regulations, the latest debt relief measures will take time to formulate and implement. The Biden administration expects Monday’s proposals to begin taking effect in the early fall, though officials would not provide a specific month or set of dates when the rollout would be complete.
It’s unclear whether the impact of the student-debt relief measures will be felt fast enough to benefit Biden in the November election.
Some polls show Biden struggling to maintain Democrats’ traditional advantage with voters under age 35, though some experts believe that the polling cross-tabs are not as accurate as the top-line results.
Biden’s trip to Madison, where he spoke at Madison Area Technical College, is part of a broader youth outreach effort on Monday that aims to spread the word of his existing and forthcoming student-debt relief plans.This post originally appeared on HuffPost.
