Congress will begin negotiations soon and will likely address unemployment benefits, financing for … [+]
The economy is still struggling with the consequences of the coronavirus pandemic. While unemployment figures look somewhat better, the number of Covid-19 cases is increasing in many states. In addition to that, the enhanced unemployment benefits of the CARES Act expire at the end of the month.
Congress will begin negotiations shortly after the holidays in the next round of coronavirus relief legislation. They are likely to address unemployment benefits and funding for state and local governments, but they could also consider a second round of direct stimulus payments and student loan forgiveness.
The CARES Act provided Americans with up to $ 1,200 in a direct cash payment, which was phased out as income increased. The House of Representatives passed the HEROES Act in May that would have provided another round of checks in the same way. President Trump told FOX Business that he wanted direct payments to Americans, but larger than $ 1,200. But Senate Republicans have been less than enthusiastic about the idea.
Student loan forgiveness could also be on the table. In March, the CARES Act suspended payments and interest on student loans. Before it happened, many put $ 10,000 in student loan forgiveness for all student loan borrowers. It was not included in the bill, but it’s something that even Democratic presidential nominee Joe Biden supports.
The HEROES Act would extend the student loan payment and interest suspension for another year, until September 30, 2021. It originally requested forgiveness of the $ 10,000 student loan for all borrowers, but was reduced to provide forgiveness for those borrowing students struggling before pandemic hit.
Now more people are pushing for forgiveness of student debt of some kind. Recently, former Obama Secretary of Education John King told Congress they should provide debt relief to struggling student borrowers.
President Trump could also be open to the idea. During the 2020 Democratic presidential primaries, Trump was said to have been considering some form of student loan forgiveness plan to compete with plans proposed by Senators Elizabeth Warren and Bernie Sanders. And at the beginning of the pandemic, he was one of the first to propose a student loan interest and suspension of payment.
What happens will be up to Senate Majority Leader Mitch McConnell. He said he does not support many of these proposals, but that he is also likely to face pressure from the White House, in addition to the House.
Related reading:
The economic stimulus of the cancellation of student debt
Obama Secretary of Education: cancel student loans in next stimulus
Pelosi Proposes $ 1,200 Stimulus Checks, $ 10,000 Student Loan Forgiveness, and College Money
What the coronavirus booster means for your student loans
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