Biden student loan debt relief

Biden student loan debt relief

Since 1980, college costs have increased nearly nine times as much as wages. If you’re poor and don’t want to join the military, get a full scholarship, or get a mysterious rich patron, you have one option: borrow against your prospects.Biden student loan debt relief.

Biden student loan debt relief

That’s what I did. My family was so poor that I qualified for both Pell Grants (government aid packages for students with “exceptional financial need”) and Perkins Loans (low-interest, subsidized loans that are unfortunately no longer available). I also took part-time jobs for many semesters.

Still, I had to borrow $10,000, a lifeline that came with a distinct threat.

Before I graduated, all of my financial aid college graduates had to sit in a cavernous lecture hall where a financial aid officer whispered into our heads the fear of God about what would happen if we ever defaulted on our payments. For hours we watched images of plummeting credit scores, lost jobs and homes, and foreclosures—all part of the transition from default to brutal ruin.

After the presentation, we all had to sign a “master guest letter” – a nice I.O.U. – and estimate our annual income after graduation to calculate monthly payments. They let us do this even if we didn’t have a job yet or if the job we got didn’t pay enough to afford to pay us.

This scare tactic left a deep impression: I skipped meals rather than miss a payment. But even after years of paying, I still have a few thousand dollars hanging over my head.

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Millions of American students, especially low-income students of color, end up taking on tens or even hundreds of thousands of dollars in debt. They had to find a way to make payments much higher than mine with stagnant wages while paying the rising costs of rent and healthcare – or supporting family members at the same time.

Biden student loan debt relief

That’s why President Biden’s order to forgive up to $10,000 in student loans for all individual borrowers making less than $125,000 a year — and up to $20,000 for Pell recipients’ grants — is such a big deal.

According to the Student Borrower Protection Center, 41 million Americans are eligible for up to $10,000 in debt relief, while 25 million Americans are eligible for up to $20,000 in debt relief. And for 20 million of us, all our debt could be forgiven and go from negative to positive for the first time in our lives.

It will unlock a significant portion of people’s wages, strengthen our economy, and address a major source of inequality among hardworking Americans of all ages and backgrounds.

Biden’s order will help in other ways, too. Borrowers with loan balances of $12,000 or less will now have future loan balances forgiven after 10 years of payments. And as long as they make their monthly payments, borrowers’ balances won’t increase — even if the monthly payment is $0 due to low income.

This is huge for people who have struggled for years or even decades under the crushing weight of student debt. It is also the floor that is needed, not the ceiling.

Forgiving all student debt would go a long way toward restructuring our economy and increasing upward mobility in our society. We also need to crack down on dodgy personal lending, which can leave borrowers paying interest for years and owing more than their original loan amount.

And finally, we must work to make public higher education free so that no one has to buy their ticket to a better future on credit.

Cross-posted by Common Dreams

The views expressed here are solely those of the author and do not reflect the views or beliefs of LA Progressive.

STUDENT DEBT JOE BIDEN STUDENT LOAN POLICY
Olivia Alperstein
BY OLIVIA ALPERSTEIN
Olivia Alperstein is the media manager in the police department.

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