Student loan payments were put on hold for six months by President Joe Biden, but efforts to forgive debt may end when a new government takes over.
An announcement from the Biden administration on October 21 said that about 8 million Americans would not have to pay back their government student loans for at least six months. However, plans for debt relief are in danger now that former president Donald Trump is back in office.
The hold is part of the administration’s new rules to pass progressive debt relief policies. These policies say that the Department of Education can forgive up to all of a person’s outstanding loans if they can’t fully return them because of personal problems. The department chooses who is eligible based on medical bills, family costs, and other unplanned financial problems that make it impossible for the borrower to repay the loans in full.
Trump and other members of his party have always been against big plans to reduce debt. The president-elect has called President Joe Biden’s plan “vile” and “not even legal.” He praised the U.S. Supreme Court’s decision in 2023 to reject Biden’s previous debt relief plans at a rally in Wisconsin over the summer, and he has repeatedly said that he wants to cut government DOE funding by a large amount.
River Hudges, a first-year at GLS, said that her mother’s student loan debt was cleared in full earlier this year and that she had planned to take out loans herself.
He said in an interview with WSN, “I was hoping that my loans might be forgiven in the future, just like my mom.” “But after the recent election, I’m very worried about what another Trump term would mean.”
Part of the White House’s Saving on a Valuable Education plan is the latest attempt to forgive debt. People who have signed up for the plan don’t have to make payments every month for the next six months. This is good for borrowers right now, but how long it lasts depends on how well the program does in court under a Trump administration.
Two years ago, Biden wanted to cancel student debt worth almost $500 billion, but the Supreme Court ruled against him by a vote of 6 to 3. His different ways of forgiving debt have erased more than $175 billion in student loan debt for nearly 5 million Americans. This is equal to about 11% of all government student loan debt that is still outstanding. Over 414 thousand people have had their student loan debt canceled thanks to the SAVE plan alone.
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