Student debt has reached crisis level as college costs grow year after year, and interest rates are keeping many people in debt. President Biden has already extended the temporary moratorium on federal loan payments to students during the pandemic Until September 30, 2021.
But with vaccines rolling out and the end of the pandemic imminent, many are wondering what will happen to student debt when the hiatus ends.
Will President Biden cancel student debts?
The boss has it He said in the past He does not believe he can cancel student debts with an executive order. He felt he lacked the legal authority to make this change.
He has said he is fully prepared to support the legislative action by Congress to cancel $ 10,000, but many Democrats in Congress say that is not enough. They are asking the president to use an executive order to forgive $ 50,000 in student loan debt per person.
Exemption from previous debts
The Ministry of Education has already canceled the debts of about 72,000 students who have been defrauded by colleges and universities. And in March 2021, it canceled $ 1.3 billion in debt for student borrowers with disabilities.
Now, the president Explore the options with your Education MinisterMiguel Cardona to use the power of executive orders. This could be promising news for those hoping to cancel student debt.
What can an executive order actually do?
In earlier comments by President Biden, he mentioned hopes for:
- Cancellation of some or all of the “stretched” student loan debt
- 0% interest rates on future student loans (this is already part of the temporary relief for the epidemic)
- Debt relief for public sector workers and students who have been defrauded by for-profit schools
The executive order may not help those who attended elite first-class schools or earned higher salaries.
The exact policy is still under consideration. We can expect more announcements from the White House regarding The authority of the executive order And cancel student debts soon.