Email audiofeedback@marketwatch.com if you would like to give feedback.
The question on millions of student loan borrowers' minds was settled Wednesday as the Biden administration announced it would cancel $10,000 in debt for borrowers earning up to $125,000 and give an additional $10,000 in relief to borrowers who received a Pell grant when they went to college
Student loan payments, collections and interest will be paused through December 31. The freeze was supposed to end in August.
The White House said that the debt of 20 million borrowers would be canceled and that most of the relief would go to low income households. There would be no relief for households in the top 5% of income levels.
$10,000 in broad-based cancellation, particularly with a means test, is not as drastic as some people had thought. Mass student debt relief has been accused of providing a benefit to Americans near the top of the income scale and could add fuel to an already inflationary economic environment.
The director of the Student Loan Borrower Assistance Project at the National Consumer Law Center said that the policy announcement would have a huge effect.
How will Biden's plan affect you? Let us know what's going on. You can email jberman at marketwatch.
The question of whether Biden's administration would provide some kind of broad-based student debt relief has been hanging over his presidency. Biden was hesitant to discharge debt larger than $10,000 through executive action, and he was also hesitant to cancel debt through executive action.
The Biden administration focused on discharging debt for borrowers, including those who were cheated by their schools, and those who were waiting on promised relief from government programs, instead of focusing on other issues. The relief given to student loan borrowers by the Biden administration has been criticized by Republicans.
The story is evolving. Don't forget to check back for the latest news.
All Rights Reserved © 2024
