One Tuesday, the Biden administration announced a new plan to forgive certain student debt held with the government. While this might be good for some who have actually used the qualifications they earned in college, it seems at least a little bit unfair if someone studying gender studies or some other useless degree, gets their debt forgiven.
At least 40,000 borrowers could see their debt disappear and the move comes after the administration has been facing criticism and pressure from Democrats to relieve student loan debt for millions of Americans.
During the covid pandemic, student loans were paused and that pause has been extended several times, the latest extension lasts until August 31.
The Department of Education is set to revise income-driven repayment (IDR) programs, and they state that this will help those who borrowed money for their education, to get debt-free sooner.
But the millions of student loans in America total a whopping $1.6 trillion, and the debt doesn’t just disappear, it’ll simply be paid by taxpayers and their children and their children’s children.
U.S. Secretary of Education Miguel Cardona said in a statement:
“Student loans were never meant to be a life sentence, but it’s certainly felt that way for borrowers locked out of debt relief they’re eligible for.” adding “today, the Department of Education will begin to remedy years of administrative failures that effectively denied the promise of loan forgiveness to certain borrowers enrolled in IDR plans.”
Under the Public Service Loan Forgiveness (PSLF) Program, the debt owed to the government will be eliminated for those who work for the government, and non-profit workers like teachers, health care workers, and military workers – after 10 years of qualifying loan repayments.
According to the agency, thousands of other borrowers with loans that are older, will also receive forgiveness through IDR and at least 3.6 million Americans will also have at least another three years of additional credit towards the program forgiveness.
Apparently, the Biden administration has been spurred on by the “historical failures” within the IDR program and plans to focus on several key issues, one of those being the end of “forbearance steering.” This occurs when a loan holder is placed into forbearance by loan services, without being given advice on alternative methods of payments or loan programs by the government – and avoiding huge interest stacked on top of the original loan.
Biden had previously announced that every loan borrower would be forgiven at least $10,000 of their debt, but Democrats are wanting that number to increase to at least $50,000 per person. Biden has not publicly supported that move, however, and the education department has said under the new guidance that if a person qualifies for loan forgiveness, they will receive this immediately.
Those with student debt, apparently don’t even have to be enrolled in the program to get the benefits and those who do decide to sign up at a later stage, will get the credits.