(Washington Insider Magazine)-Students are waiting patiently to hear about the status of their student loan forgiveness, promised under President Biden.
President Joe Biden has expressed his determination to follow through with his campaign promise and forgive $10,000 in federal student loans for those making $150,000 a year or less–before the August 31st repayment date. This could help the dwindling number of students considering college for their career and life training experiences.
With the anticipated grace period for student loan repayment expiring next month, borrowers hope to hear details of the plan sooner than later. The White House assures borrowers that financial relief for student loan debt will come before August 31, 2022. However, many are concerned. Currently, there has been no justification for the deferment; leaving borrowers wondering if it will happen at all.
Under President Biden’s plan, only certain student loans will be eligible for forgiveness. Private student loans, from an independent lender, bank, credit union, or the popular educational loan supplier Sallie Mae, will not qualify. In addition to private loans, graduates who earn a salary of $150,000 or more will
not qualify. Currently, only Federal student loans are eligible for
President Biden’s student debt relief. However, Congress is said to be contemplating a wider-spread student loan forgiveness program that could cover non-traditional or private loans.
Despite many urging him to do so, President Joe Biden doesn’t have the sole authority to push the student loan forgiveness through. Borrowers will need to wait for Congress to authorize the debt forgiveness plan before he can issue an executive order and begin financial relief.
Many have misunderstood the Higher Education Act of 1965 and insist that the President can implement a debt relief plan on his own. However, the Higher Education Act of 1965 actually limits the President in this ability to execute wide-scale federal student loan forgiveness.
Borrowers should anticipate reestablishing payment plans, and pay-offs, once the pause on the student loan repayment date expires.
