Biden administration announces student loan debt relief

Photo by micheile dot com on Unsplash.

On Aug. 24, the Biden administration announced its three-step process to cancel $10,000 in student debt for low- to mid-income individuals. A myriad of reactions from relief to anger indicated the plan was as ambitious as it was controversial; such an idea has circulated the U.S. political sphere from figures like Bernie Sanders and contemporaries, but similar proposals lacked traction until this abrupt announcement.

Those with questions about funding and outreach were quick to express intrigue and curiosity regarding the program’s specificities. Thus far, the details of the plan have proven to be rather unclear, though not without direction: the White House claims that federal student loan repayments will now be paused through Dec. 31, with payments to proceed following the new year. Those affected by student debt are eligible for the aforementioned $10,000 in relief if their individual income is below $125,000 per year or $250,000 for married couples. Those listed as dependents on tax filings reportedly also qualify. Eligibility extends to an additional $10,000 in available aid if borrowers benefited from the federal Pell Grant, which itself offers 66% of its aid to those from families with average incomes beneath $60,000 per year.

The Biden Administration estimates that this plan will extend aid to 43 million Americans who have taken student loans, with a projected potential to cancel the remaining debt of approximately 20 million Americans within the total scope. In all, 27 million Americans are estimated to be eligible for the full $20,000 sum — just over 8% of the total U.S. population. Moreover, the White House calculates that nearly 90% of these benefits will be allocated to individuals making less than $75,000 per year.

According to the Aug. 24 press release, this recent push for loan forgiveness invokes a plethora of socially just advancements through racial equity, relief to low and middle-income borrowers and diversified distribution of aid to many age groups. 

Jewell students said they could experience benefits of this policy as well — hardly a surprise on account of the price tag that a higher education degree in the U.S. carry. One student, Waylon Masters, a sophomore philosophy major, said he sees the appeal of the policy as a college student.

“I’m glad there are accommodations for the Pell Grant in particular; it’s almost scary that these loans amount to a larger sum of money than I’ve held in my entire life,” Masters said. ”I can definitely see why student debt is such a huge problem for most Americans.”

No application for this form has been released to the public yet, though the date of Nov. 15 has been recommended in order to ensure borrowers receive aid before the federal debt freeze expires. Government websites remain practically evergreen in their opaque wording and constant cross-references to other federal sites; as such, those interested in the offer can visit the Department of Education’s email subscription page for further notice on the application’s availability. Additional information from the Student Aid FAQ assures would-be applicants that the program’s deadline extends into Dec. 31, 2023 — additional queries regarding eligibility may be answered there.

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