How Biden student loan plan is playing at AU, elsewhere
AUGUSTA, Ga. (WRDW/WAGT) - There’s a sigh of relief for millions of Americans and many in the CSRA struggling to pay back student loan debt.
After President Joe Biden announced his plans to forgive a lot of student debt, we spent Wednesday at Augusta University, where we broke the news to some students who hadn’t heard yet.
And they were happy to hear it, but not everyone is.
“As of right now I have 16,000 in student loans,” said AU freshman, Jaylynn Powell. After school, I plan to buy a house in the next four to five years.”
Before Wednesday, the Biden administration has already canceled nearly $32 billion in student loan debt.
Biden’s new plan applies to all federal student loan borrowers.
The amount of debt canceled depends on your income and whether you received a Pell Grant to attend college.
Single borrowers who make less than $125,000 and married couples who earn less than $250,000 without a Pell Grant will have up to $10,000 forgiven.
If you did receive a Pell Grant, Biden plans to knock out $20,000 of your student loan debt.
AU sophomore, Jason Boyd, said: “Where I come from we don’t get that most of our stuff or from food stamps, financial aid stuff like that. I’m like the first real kid to be in college.”
Biden is also extending a pause on all federal student loan payments for what he called the “final time” through the end of 2022.
Some Augusta University students say this is a huge weight lifted off their shoulders.
“I’m happy, you know. I’m pretty sure a lot of other kids that struggle financially are happy, too,” said AU sophomore Jason Boyd.
For more information, visit the U.S. Department of Education website.
More about the plan
If the plan survives legal challenges that are almost certain to come, it could offer a windfall to many in the run-up to this fall’s midterm elections.
More than 43 million people have federal student debt, with an average balance of $37,667, according to federal data. Nearly a third of borrowers owe less than $10,000, and about half owe less than $20,000. The White House estimates that Biden’s announcement would erase the federal student debt of about 20 million people.
“That’s 20 million people who can start getting on with their lives,” Biden said. “All this means, people can start to finally crawl out from under that mountain of debt. To get on top of their rent and utilities. To finally think about buying a home or starting a family or starting a business.”
Proponents say cancellation will narrow the racial wealth gap — Black students are more likely to borrow federal student loans and at higher amounts than others. Four years after earning bachelor’s degrees, Black borrowers owe an average of nearly $25,000 more than their white peers, according to a Brookings Institution study.
Biden has faced pressure from liberals to provide broader relief to hard-hit borrowers, but also from Republicans questioning the fairness of any widespread forgiveness.
The White House emphasized that no one in the top 5% of incomes would see any loan relief.
But top Republicans were not persuaded.
Senate GOP leader Mitch McConnell said, “President Biden’s inflation is crushing working families, and his answer is to give away even more government money to elites with higher salaries. Democrats are literally using working Americans’ money to try to buy themselves some enthusiasm from their political base.”
In fact many Democrats, from congressional leaders to others facing tough re-election bids this November, have pushed the administration to go as broadly as possible on debt relief, seeing it in part as a galvanizing issue, particularly for Black and young voters.
The Biden administration plan would also raise the income floor for repayments, meaning no one earning below 225% of the federal poverty level would need to make monthly payments.
Biden’s plan builds on $32 billion in targeted student debt forgiveness his administration has enacted for certain groups of borrowers. Much of that went to borrowers who say they were defrauded by for-profit colleges.
The administration also temporarily has relaxed the rules for Public Service Loan Forgiveness, a complex program that allows teachers, social workers and other public servants to get student debt canceled after 10 years of monthly payments.
The Associated Press contributed to this report
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