President Biden announces student loan forgiveness plan

WASHINGTON, D.C. – President Joe Biden announced on Wednesday a plan to cancel student loan debt for a subset of Americans and keep a pandemic-era pause on repayments.

As part of this plan, Pell Grant recipients can qualify for up to $20,000 in debt forgiveness, while other student loan borrowers who don’t have Pell Grants will have loans forgiven up to $10,000. Both forgiveness options are for people who earn less than $125,000 per year, or $250,000 per household.

Additionally, Biden also announced an extension of the pause on student loan payments through December 31, 2022, which will be the final extension. Millions of borrowers were due to restart payments on September 1, however, this move will give time for the transition back to repayment.

One-third of federal loan borrowers have less than $10,000, meaning they could see their debts completely wiped out should this policy come to fruition. Another 20% of borrowers, around 9 million people, would have their debt at least slashed in half.

“In keeping with my campaign promise, my Administration is announcing a plan to give working and middle class families breathing room as they prepare to resume federal student loan payments in January 2023,” Biden wrote in a Twitter post.

Biden is expected to release more details Wednesday afternoon in a press conference.