The Biden administration announced Wednesday it will “cancel” up to $20,000 in student debt for borrowers who qualify. However, concerns have been raised about what that might entail.
Christina Christie of Orlando works with students and said this will help so many people get back on their feet. Christie said that post-graduation, it is tough to juggle a job with entry-level pay and tons of debt.
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“When you’re going to university, the goal is that you start a life that’s going to allow you to make a lot of money and get yourself back on your feet, and student loan debt is a barrier to that,” Christie said.
The debt forgiveness was welcome news for many, but some people believe the eligibility requirements are unfair. Some people say the salary cap and the amount of debt forgiven should be higher.
“I think it’s easy to feel upset because, you know, it’s like they’re getting something. ‘Why am I not getting that?’ and case in point is if they’re making less money, they may need it more,” Christie said.
Critics of the move have cited concerns over the fact that the cost burden of the loan-forgiveness policy will be placed on those who did not attend college or already paid off their own student loans.
Today, @JoeBiden forced every American who didn't attend college or has already paid off their loans to now pay off others' debts.
— Rick Scott (@SenRickScott) August 24, 2022
Democrats' canceling student loans isn't a "relief" for Americans. It's an added burden that will only further increase inflation.
Further concerns have been raised about the impact on people’s finances, as experts pointed to excessive government spending as a factor behind recent skyrocketing inflation rates.
The legality of whether the president has unilateral authority to forgive student loan debt has also been called into question, as the Justice Department stated the policy hinges on the HEROES Act of 2003, which allows the president to eliminate student debt during a national emergency.
In 2020, former President Donald Trump declared such a national emergency in response to the COVID-19 pandemic.
The administration is still trying to help borrowers who do not qualify for forgiveness.
To ease the transition, President Joe Biden is extending the pause on federal loan repayments one final time through Dec. 31, 2022.
The administration is also proposing a new income-driven repayment plan. If you have undergraduate loans, you can cap payments at 5% of your monthly income, which is about half the rate most borrowers pay now.
Most people will need to apply for the relief. Officials say those applications will be available before the end of the year.
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