It should be understood that stimulus payments and other forms of pandemic-era relief have impacted the economy heavily. Congress had pumped trillions of dollars into the American economy- which helped the citizens cover a large part of their basic living expenses, as well as paying their debts.
The same theory, now, has been seemingly applied to the student loan forgiveness program of the Biden administration. It has been mentioned that a large part of the population will have their debt wiped out while others would be benefiting from lower monthly student loan payments. But- after the announcement made the previous August, the Supreme Court has apparently blocked Joe Biden’s plan to forgive up to $20,000 in federal student loan debt. So- until some form of a final decision is chanced upon, everything will remain in a position of limbo.
Student Loan Forgiveness Plan Could Be In The Works
If the plan were to pass, the White House has estimated that the Student Loan Forgiveness program will be providing aid to close to 43 million borrowers and an estimated 20 million borrowers would be seeing their remaining debt balance canceled completely. Around 90% of the debt cancellation benefits will be delivered to borrowers who have earned under a sum of $75,000 every year. It was also noted that the President’s plan has included multiple provisions to cap the monthly payments for undergrad loans to around 5% of the discretionary income of the borrower.
Goes without saying, college debt has had a major detrimental impact on graduates for years. The borrowers of student loans have had their own difficulties when applying for credit with less money to spend. So, a student loan forgiveness program would actually make the situation better for a large part of the population.
