Student Loan Forgiveness 5 Major Takeaways From New Plan To Cancel
Here are 5 major takeaways from a new plan to cancel student debt. Here’s what you need to know — and what it means for your student loans. Days before President Joe Biden announces his decision on student loan forgiveness, a major new plan for student loan forgiveness has rocked Capitol Hill. Three members of Congress, Reps. Virginia Foxx (R-NC), Elise Stefanik (R-NY) and Jim Banks (R-IN), introduced major legislation on student loan forgiveness and student loan repayment. Their new bill, which faces an uphill battle in a Democrat-controlled Congress, offers an alternative to Biden’s potential plan to cancel student loans and change the future of student loan debt. Here are 5 significant takeaways from the new plan on student loan forgiveness. First, the plan includes no wide-scale student loan cancellation. More than 40 million student loan borrowers are waiting for an answer from Biden on student loan forgiveness. They’re hoping for $50,000 of student loan forgiveness but expecting $10,000 of student loan cancellation. Leaked documents from the U. S. Department of Education show who could qualify for wide-scale student loan forgiveness. However, Biden hasn’t decided if he will enact wide-scale student loan cancellation. Therefore, Biden could forgo broad student loan forgiveness. The bill reflects Republican sentiment about student loan forgiveness: it’s overwhelmingly expensive, represents unfair wealth redistribution and hurts Americans who didn’t attend college or don’t have student loans. Progressive members of Congress disagree, stating that wide-scale student loan forgiveness will stimulate the economy, reduce disparities and provide a financial lifeline to millions of borrowers. Democrats say student loan borrowers are suffering financially from the Covid-19 pandemic, and student loans have prevented them from getting married, starting a family, buying a home and saving for retirement. Second, the new bill would end student loan forgiveness for public servants. Specifically, the bill would end the Public Service Loan Forgiveness program starting on July 1, 2023. Student loan borrowers who are pursuing public service loan forgiveness before that date presumably would remain eligible to get their student loans canceled. Like wide-scale student loan forgiveness, some Republicans believe eliminating public service loan forgiveness would save the federal government billions. Democrats want to continue the federal program to help police officers, firefighters, service members, first responders, doctors, nurses and other public servants to get student loan relief. Since becoming president, Biden has canceled more than $25 billion of student loans, including $8 billion of student loans for public servants. Congress created the Public Service Loan Forgiveness program in 2007 with bipartisan support. Third, the bill would create a new, single income-driven repayment plan similar to Income-Based Repayment (IBR).
All data is taken from the source: http://forbes.com
Article Link: https://www.forbes.com/sites/zackfrie...
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