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8/24/22 - President Announces Details of Student Loan Forgiveness Plan

Wednesday, August 24, 2022 at 3:37 PM

The Department of Education says millions of Americans will find relief under this new plan. Image courtesy of the US Department of Education. 8/24/22.

Who qualifies, and who will be affected were part of the details released today by the President.

If it’s any indication of the questions around the new student loan forgiveness program, the federal student aid website was experiencing high volumes of traffic this afternoon.  

President Joe Biden announced a plan through the Department of Education that would see student loans forgiven for close to 45 million Americans.  The plans call for 10 thousand dollars in loan forgiveness for those making under 125 thousand dollars a year.  And 20 thousand dollars for those who are under the income threshold and were recipients of Pell Grants.

Some 93 million Americans have some type of student loan.  Millions have also been saddled with the additional burden of a loan, but no college degree.

President Biden says the department will also streamline several services, including capping repayment plans, and forgiven loan balances after 10 years of repayment, on balances of $12,000 dollars or less.  He will also extend the repayment moratorium until December 31, 2022, but no further.

Strong reaction to the plan has already poured in.  US Representative Bill Huizenga released a statement immediately following the President’s announcement.

“Frankly, this is an insult to the students who worked their way through school as well as the parents or spouses who took a second job to make sure the bills were paid.  This reckless act is estimated to cost taxpayers $300 billion and will make inflation even worse for families already struggling to make ends meet.”

Huizenga also claims the program will send the cost of college tuition “even higher” and putting a college education out of the reach of future generations.

 

 

 

 

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