Yes, $15 billion of student loans has been canceled by President Joe Biden.
Here’s everything you should know about them, and what it means for your student loans.
- What it means for your student loans
- More people are getting student loan forgiveness because of student loan relief
- Download The Loan Comparison Calculator
- Is this the maximum amount of student loan cancellation we will receive?
- Here’s what Biden said last week about loan forgiveness
- The White House has confirmed that student loan payments will resume on May 1
What it means for your student loans
Despite the fact that numerous students have complained about not receiving enough loan forgiveness, it’s important to keep in mind that Biden has already canceled $15 billion worth of student loans during his first year in office.
That is more than any other president and significantly more than the 675,000 student loan borrowers who have benefited.
Here’s a look at the numbers:
- Borower Defense To Repayment: $1.5 billion
- Total and Permanent Disability: $7 billion
- ITT Tech Students: $1.3 billion
- Public Service Loan Forgiveness: $5 billion
We’ve only just begun.
Borrowers of student loans can also qualify for a variety of additional student loan forgiveness options, including public service loan forgiveness, total and permanent disability, and borrower defense to repayment.
More people are getting student loan forgiveness because of student loan relief
The $15 billion in student loan forgiveness doesn’t include tens of billions of dollars more in student debt relief that Biden, Trump, and Congress have provided.
In March 2020, Congress passed the Cares Act, which became known as the $2.2 trillion stimulus bill.
That bill provided historic student loan relief, including temporary student loan forbearance, no new interest on federal student loans, and no collection of delinquent loans.
Borrowers of student loans have been able to count non-payments of student loans each month since March 2020 toward income-driven repayment and public service loan forgiveness programs such as these.
Since becoming president, Biden has extended student loan forgiveness many times.
According to the U.S. Department of Education, borrowers have collectively saved $5 billion every month due to student loan relief programs.
When federal student loan payments resume on May 1, 2022, borrowers will have saved more than $120 billion in interest charges.
Is this the maximum amount of student loan cancellation we will receive?
There hasn’t been enough student loan cancellation, according to advocates of wide-scale student loan cancellation (the idea of mass student loan forgiveness for all or most borrowers).
They claim that while they accept $15 billion in student debt forgiveness, it’s insignificant when compared to the overall number of student loan borrowers and total outstanding student debt.
There are, for example, 45 million student loan borrowers who owe more than $1.7 trillion in educational debts.
Biden has helped more than 670,000 borrowers get out of debt by canceling approximately $15 billion in student loans.
$15 billion is a significant amount of student loan forgiveness on an absolute basis.
However, while relative in comparison to previous decades, student loan forgiveness has fallen short so far.
The cancelled debts of student loans have benefited just 1.5% of all borrowers and less than 1% of overall debt.
Here’s what Biden said last week about loan forgiveness
Biden was asked whether he still intends to cancel $10,000 of student loans for borrowers on the verge of defaulting.
However, as of late he has been a bit more vague. He stated that he’d support $10,000 in student debt forgiveness, but that he didn’t have the legal authority to cancel everyone’s loans.
Instead, Biden has called on Congress to cancel large chunks of student debts for millions of borrowers.
Biden has said that he will sign any student debt forgiveness legislation Congress sends him.
Biden did not directly answer the question at the press conference, however.
The question was a component of a two-part inquiry, and Biden began by addressing the second half.
The following question was the last one during the nearly two-hour news conference.
While the Biden administration is researching a variety of strategies for student loan rehabilitation and forgiveness, there’s no indication that he’ll push for national student debt cancellation.
The White House has confirmed that student loan payments will resume on May 1
While members of Congress declared that millions of student loan borrowers are unprepared to pay their loans, the White House reacted quickly by stating that student loan payments will resume on May 1, 2022.
The White House also reaffirmed Biden’s support for $10,000 of student debt forgiveness, which he has maintained since his campaign.
Biden is prepared to cancel up to $10,000 for millions of student loan borrowers, A bill has not been passed by Congress. Biden says he’ll sign the legislation after it passes student loan relief.
Despite he claims that student debt will be forgiven, the White House has confirmed that he is still investigating administrative alternatives.
“No one has been asked to pay a single cent of federal student loans since the President was elected,” a White House representative told The Hill today.
Borrowers who are still recovering from the epidemic will benefit from the pause, which was announced in December.
In May, the Education Department will continue to work to ensure a smooth transition to repayment.
The President endorses legislation providing $10,000 in debt relief for borrowers.
Based on this most recent student loan news, it appears that federal loan payments will resume on May 1. Get started now.
Take advantage of every available student loan relief opportunity to ensure you’re not caught off guard when it comes time to repay your student loans.
Marie got her journalism degree from the University of California and is an award-winning financial journalist, who’s responsible for collecting and analyzing information concerning students and young adults within the world of finance.
Marie has spent her career with more than 5 years writing for unique media outlets like Yahoo finance, GoBankingRates, and CNBC. She also teaches them how to plan strategically to get out of loan debts easily.
Her goal is to educate students about the different stages in life that involve finances so they can get their money’s worth.