Recent reports indicate that President Biden is considering student loan forgiveness for borrowers who have federal student loan debt. If he does enact student loan forgiveness, federal borrowers could see relief as soon as Aug. 31. Here’s what to know about this week’s student loan news.
1 current trend within student loans for the week of May 9, 2022
1. Federal student loan forgiveness could still be on the table
In late April, Biden signaled to members of the Congressional Hispanic Caucus that he’s considering mass federal student loan cancellation through an executive order. While the details are still being finalized, the move would be significant; Biden campaigned on the idea of forgiving $10,000 of student loan debt per borrower, but thus far his administration has steered clear of widespread forgiveness.
How this affects student loans
There are no plans yet for what Biden’s student loan forgiveness would look like. The Washington Post reported that the administration is considering setting income limits for who qualifies for forgiveness, with potential annual income caps of around $150,000 per individual and around $300,000 per couple filing jointly.
As of now, the forgiveness would also be limited to federal student loans. Borrowers with private student loans, including those who have refinanced their federal student loans with a private lender, would not be eligible for this forgiveness.
The timing of student loan forgiveness is also unclear, although White House Press Secretary Jen Psaki said in a press briefing that a decision would be made before the end of the federal student loan forbearance period. That period is currently set to end on Aug. 31, 2022, though it could be extended further.
Here’s how you can get prepared
Whether you’re new to student loans or well into repayment, it’s wise to stay informed about how your student loan rates could change. During 2022, more opportunities for cheaper loans or loan forgiveness could open up; keep an eye on the Bankrate student loans news hub for the latest trends.