Borrowers in the United States are expecting vacations and medical school as a result of student debt forgiveness.
Kanishka Singh wrote this.
(Reuters) – WashingtonAmericans with large student loan debts hailed U.S. President Joe Biden’s statement on Wednesday that he would erase $10,000 in student loans, and several expressed hope that they would be able to forego more work hours and take a vacation or return to school.
“I would not have second thoughts while arranging a trip or going on vacation,” said John Paul, 49, a restaurant manager in Washington, DC, who admitted to taking out loans for his son’s education. Previously, we would have this debt looming over us in the back of our minds. We are now slightly relieved. ”
He was interviewed shortly after the Biden administration announced that it would extend a COVID-19 pandemic-related pause on student loan repayment until the end of the year while also forgiving $10,000 in student debt for borrowers whose annual income is less than $125,000, or $250,000 for a married couple.
Paul claims that the relief will slash his outstanding debt in half.
Vincent Joseph, who graduated in 2019 and now works at a lobbying company in Washington, said he was relieved to learn that his remaining $6,500 in debt would likely be forgiven.
He added that there might be an entire following generation that does not have to work extra hours or more jobs to repay this debt, “he added, noting that he had worked while in college to pay off his debts.
“Many individuals work extra jobs and, as a result, sacrifice time with friends and family because they are concerned about their debt,” he added, calling it a small step in the right direction.
According to a study published before the COVID-19 outbreak by the nonpartisan Government Accountability Office, millennials “had much greater college debt, fewer levels of homeownership, and less net wealth than preceding generations.”
Alexis Horton, a biology major at Howard University, said the decision is reassuring for individuals who intend to continue their education.
“As a biology student hoping to go to med school, I have a lot of loans at school, so knowing that I might perhaps get $20,000 or $10,000 (off) sounds extremely nice,” Horton told Reuters.
Advocates for student debt relief applauded the move but asked the Biden administration to do more to address structural issues.
Kyra Taylor, a student loan attorney with the National Consumer Law Center, hailed the move as “life-changing for millions of Americans.”
According to the White House, its debt relief proposal may result in the total cancellation of debt for around 20 million people. According to educationdata.org, around 43 million Americans have federal student loan debt.
On the other hand, Taylor, on the other hand, believes that the proposal does not go far enough to assist borrowers with greater loads, such as many black Americans, who suffer significant debt burdens, according to experts.
“The government should make extra efforts to address racial imbalances that the student loan system has perpetuated,” she told Reuters. “This means that black Americans, particularly black women, are saddled with higher student loan debt merely to access the same opportunities as others.”
The government also announced that it will forgive up to $20,000 in debt for recipients of federal Pell Grants, which represents approximately 6 million students from low-income families, and that it will propose a new rule that will protect some income from repayment plans and will forgive some loan balances after 10 years of repayment.
Kanishka Singh in Washington contributed reporting and writing, as did Julio-Cesar Chavez and Matt McKnight, and the piece was edited by Heather Timmons and David Gregorio.)
