President Joe Biden, speaking about student loan relief at Delaware State University in October. The Supreme Court will hear challenges in February to his plan to forgive up to $20,000 for some borrowers.
The Associated Press.
More than 45 million people in the United States owe a total of $1.6 trillion in student debt, according to the White House, a crippling burden for many borrowers just entering the workforce.
After years of debate, months of speculation and even more waiting, President Biden announced in August a sweeping plan to forgive federal student loans and enact wide-ranging debt relief.
“All of this means people can start finally to climb out from under that mountain of debt,” Biden said when his plan was announced over the summer. “To finally think about buying a home or starting a family or starting a business. And by the way, when this happens, the whole economy is better off.”
Biden’s signature student-loan forgiveness plan would wipe out $10,000 in federal student loan debt for borrowers earning less than $125,000 per year or $250,000 per year if they are married — a historic first. It would apply to 16 million borrowers, according to some estimates. Pell Grant recipients would be eligible for up to $20,000 in relief if they earn less than $125,000 per year (or $250,000 per year if they are married).
Even before the plan’s initial steps could be formulated, legal challenges have delayed its implementation. The plan is facing two major legal challenges that are scheduled before the Supreme Court in February, when Justices will hear oral arguments over the constitutionality of the long-awaited plan to ease the financial burden on tens of millions of borrowers.
The Biden administration extended in November the pause in student loan repayments into 2023 while the Supreme Court prepares to hear appeals from the U.S. 5th Circuit Court of Appeals and the 8th Circuit Court of Appeals. Otherwise, the pause would have expired at the end of this year.
The pause, which has been in effect since March 2020, around the onset of the Covid-19 pandemic, “also set interest rates to zero on government-held federal student loans and suspended all collections efforts against borrowers in default.”
Our expert contributor, Adam S. Minsky has carefully followed the often-extended repayment pause and catalogued the debate over Biden’s ultimate plan.
‘You Will Not’ Have To Pay Your Student Loans In January, Education Department Tells Borrowers
The Education Department sent out notices to borrowers reminding them that the student loan pause has been extended, possibly as long as six to eight months.
Included in the sweeping bipartisan budget the bill are several provisions that may impact student loan borrowers and their families.
The Top Student Loan Forgiveness Updates Borrowers Should Know About
With so many fast-moving developments impacting President Joe Biden’s student loan forgiveness initiatives, it can be hard for borrowers to keep track of updates. Here’s where things stand.
Supreme Court Takes Next Big Step In Student Loan Forgiveness Cases
The Supreme Court will hear oral arguments in two legal challenges to President Biden’s one-time student loan forgiveness program on Feb. 28, 2023.
Student Loan Forgiveness Update: Here’s The Latest Supreme Court Timeline
The Biden administration has consistently maintained that the lawsuits are frivolous and that the student loan forgiveness program is legal, and appealed to the Supreme Court.
When Will You Receive Student Loan Forgiveness? Timelines For 4 Programs
Here’s what borrowers should know, and when to expect student loan forgiveness under several different government initiatives.
Source: https://www.forbes.com/sites/jeffreymarcus/2022/12/26/year-end-expert-advice-on-student-loan-forgiveness/