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Can Joe Biden Really Cancel Student Loan Debt?
Here’s what you need to know.
Student loans
Forgiveness of student loans has been a hot topic on the campaign track and in the halls of Congress. Fan sen. Bernie Sanders (I-VT) wants to forgive sen every $ 1.6 trillion in student loan debt. Elizabeth Warren (D-MA) who proposes to forgive student loans for 95% of Americans, presidential candidates have their plans for your student indicated loans. In Congress, House Democrats proposed forgiving $ 10,000 student loans for lenders struggling financially, while senators said $ 10,000 in student loan debt should be canceled. There have even been proposals to cancel $ 50,000 of student loan debt and forgive student loans due to Coronavirus.
Bid: Student loan debt canceled
In response to Covid-19, Biden proposed a student loan forgiveness plan for Covid-19 to cancel up to $ 10,000 in student loan debt for each loan. However, bidding does not support widespread student loan forgiveness, for example forgetting all your student loan debt. Does Biden support other student loan forgiveness? Yes, Biden would forgive all undergraduate teaching from two- and four-year public colleges and universities. Biden would also forgive any undergraduate degree for lenders earning $ 125,000 or less per year and graduating from a private Historic Black Colleges and Universities (HBCUs) and Minority Services Institutions (MSIs).
Can a president cancel student debt?
While candidates and lawmakers can both propose proposals, it is doubtful whether a president – without Congress – can cancel student loans alone. Biden, who has been a U.S. senator for nearly 40 years and is familiar with separation of powers, would likely work with Congress to implement legislation to cancel student debt (instead of acting unilaterally as president). Traditionally, when presidents or presidential candidates propose policy initiatives, their plans are normally prescriptive – meaning that Congress must take the prescribed action. Or, the president’s administration will work with Congress to pass legislation. However, if Republicans retain control of the House of Representatives after the November election, it could be more challenging to pass any comprehensive student loan bill.
It is important to note that not everyone agrees that only Congress can cancel student debt. For example, Warren said, as a presidential candidate, that the U.S. Department of Education has the authority to cancel student loans. Warren has been a leading student loan forgiveness advocate, and Student Debt Crisis, a leading non-profit student loan advocacy firm, sent Warren a petition for student loan forgiveness signed by 1.2 million people. Warren said that if she were elected president, she would instruct the Secretary of Education to begin forgiving student loans on day one of a Warren administration. “On day one of my presidency, I will start using current laws to implement my student loan cancellation plan that provides relief to 42 million Americans – in addition to using all available tools to address racial differences in higher education, coming down to for-profit institutions , and eliminate predatory lending, ”said Warren, a former professor at Harvard Law School, during her presidential campaign.
While the Department of Education may cancel federal student loans due to death, disability, or fraud, for example, others argue that a large-scale plan for forgiveness of student loan congressional legislation would be necessary based on an argument for separation of powers.
Next steps
During the last two presidential administrations, a president did not cancel the student loan debt through the Secretary of Education. Currently, President Donald Trump has extended relief for student loans under the Cares Act, the $ 2.2 trillion incentive package passed by Congress in March, through December 31, 2020. That means certain federal student loan payments are paused, interest will not rise on those loans and any non-payment of those loans will count towards forgiveness forgiveness for public service. There will also be no collection of failed federal student loan debt during this period. While Trump implemented this extended relief of student loans through an executive memorandum, Trump did not cancel student loan debt, which would typically require congressional approval. In Congress, the latest Republican incentive law does not provide relief for student loans or forgiveness of student loans. While Democrats in the House of Representatives and the House of Representatives have proposed annulment of student loans, Congress has not passed legislation. Since Biden and his running mate, sen. Kamala Harris (D-CA) both have served in Congress, it is more likely that they will support their student loan agenda through Congress, instead of taking unilateral action for student loan forgiveness.
How can you pay off student loans?
Even if payments on federal student loan debt are temporarily paused, your student loan balance and interest rate will not change when payments restart. Therefore, you need to act now to develop a game plan for student loans to pay off student loans. What is the best way to pay off student loans? Start with these four options, all of which have no fees:
Sources: Student loans
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