There is still hope for people with student loan debt that the White House will be able to help them get rid of their debt before the election in November. With only a few days left, the government Education Department released a new plan for how students could finally get their debt forgiven. This plan could make the lives of about 8 million Americans who are still paying off their loans better.
This is the last chance the Administration has to get this much-needed help for millions of borrowers passed. However, if Vice President Kamala Harris wins the election, efforts to pass better loan cancelation measures will likely continue.
This new plan is a little different from the others because it would give direct power to the U.S. Secretary of Education. If this Secretary had the power, they could cancel the debts of student loan borrowers who the government thinks will not pay back their loans in the next two years.
Of course, they would have to meet certain requirements in order to be considered, but if the Secretary of Education had the power, more steps could be taken as the requirements changed.
But this isn’t the only thing that the new plan does. A new application would be made so that borrowers who are going through “hardship” could directly ask for forgiveness, which would make it easier for them to make their cases. Within the limits, “hardship” includes things like long-term illness, medical debt, child care costs, and the effects of natural disasters, among other good reasons.
All of these things would make it very hard for a borrower to pay back their loans. Letting lenders know about this before they stop paying would save many families money in the short and long run.
Lael Brainard, who is the national economic director, backed this idea. She used the example of how hard natural disasters have been on families trying to stay afloat to show how worrying about student loans is something they don’t need.
Brainard told the press, “In the past month, we’ve seen how terrible it can be for people when disasters like Hurricanes Helene and Milton hit.” “Paying off student loans at this point in time shouldn’t be an extra burden.”
Rep. Virginia Foxx, R-N.C., the outgoing chair of the House education committee, is strongly against the new plan, as she has been against all forms of it. She calls it a “blatant attempt to bribe voters” right before they go to the polls.
Prior attempts to cancel Student Loan Debt
Since the Administration’s previous plans have run into problems, it makes sense that they would come up with a new way to forgive so that they don’t have to deal with the same problems.
One of the first tries, called SAVE (Saving on a Valuable Education), is now in appellate court, and oral arguments have already begun. Andrew Bailey, the Republican attorney general of Missouri, thinks that a decision might come soon. Many borrowers who were eligible for the plan have been waiting for six months for the verdict, which would finally put them out of their misery.
The deputy executive director of the Student Borrower Protection Center, Persis Yu, praised the Administration for continuing to work to get rid of student loan debt even though the Republican party was putting up barriers at every turn. Right-wing Attorneys General have been going after millions of working families with student loans nonstop for the past year, trying to score political points by putting them in more debt.
The sad truth is that Student Loans affect families of all party stripes. Cancelling them would help many families who are having a hard time making ends meet through their finances.
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