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- Biden is leaning toward up to $10,000 in student-loan forgiveness for those making under $125,000 a year, per CNN.
- This announcement could come as early as Wednesday.
- Borrowers are also waiting for news of an extension of the payment pause, set to expire after August 31.
The final days of waiting for student-loan forgiveness might have finally arrived.
On Monday, CNN reported that President Joe Biden is leaning toward canceling up to $10,000 in student debt for borrowers making under $125,000 a year, according to sources familiar with the White House plans. Per CNN, this announcement could come as early as Wednesday, and a source familiar with the matter confirmed that timeline to Insider.
This comes right before the student-loan payment pause is set to expire. In April, Biden extended the pause for his fourth time, through August 31, and the president — along with Education Secretary Miguel Cardona — have confirmed a decision on another extension of the payment pause, along with broad debt cancellation, will be announced before the August 31 deadline.
"We know August 31 is a date many people are waiting to hear something from," Cardona said on Sunday. "We've been talking daily about this and I can tell you the American people will hear within the next week or so what the Department of Education will be doing around that."
Neither the White House nor the department have publicly confirmed details of student-loan forgiveness, or the potential for another extension of the payment pause, but calls have been ramping up from Democratic lawmakers and advocates to take borrowers out of limbo and deliver them financial certainty. At the end of July, for example, 107 Democratic lawmakers called for Biden to extend the payment pause, and on Monday, NAACP Director of Youth and College Wisdom Cole wrote in a statement that if "student debt repayments can be paused over and over and over again, there's no reason why the President cannot cancel a minimum of $50,000."
In April, Biden ruled out canceling as much as $50,000 in student debt, and his advisors have expressed concerns about the impact any relief might have on inflation. Jared Bernstein, a member of the White House Council of Economic Advisers, previously told The New York Times that canceling student debt and resuming payments at the same time was under consideration because "the net inflationary effect should be neutral."
Still, there's speculation the payment pause will be extended given that the Education Department recently directed student-loan companies to halt messaging surrounding the payment restart. And while Politico recently obtained documents detailing the department's preparedness to implement relief once announced, advocates have expressed concerns about targeting the relief based on income.
For example, if borrowers have to apply for relief or certify their incomes, the paperwork burden could shut those who need the loan forgiveness most out. "You're not making the policy more progressive because of how hard it's going to be for folks to demonstrate that they have a low enough income to benefit," Mike Pierce, executive director of nonprofit Student Borrower Protection Center, previously told Insider.
To be sure, the White House can change its decision at any moment prior to the announcement, and the most certain thing at this point is the expectation of student-loan news before the end of August.
from Business Insider https://ift.tt/dHwiLcg
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