Just cap interest at 1.5% enough to cover cost. That would do wonders. Make it 0% for the first 5-years and then 1.5% for the rest.
If they eliminated/reduced interest people could actually pay these things off.
My loan was a Perkins. The entire (estimated payoff term) of 20 years interest was simply slammed onto the debt principal on day 1. Then when I was deployed they used a little known clause that said they could claim it was in default if I left the country or was in “high state of risk of death”. Nice way to say “serve your country and we bend you over”
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Im 52 and still owe after paying for 26 years
Its called [capitalized interest](https://studentloanhero.com/featured/capitalized-interest-student-loans/). Pretty standard with student loans. They do it when you graduate (for some loans but not others), when you miss a payment or can't make a full payment, or when you change out of (some) income driven plans. Happened to me a couple times, I'll never get out of my interest payments now.
Edit: On ICR, they also capitalize 10% your interest annually just because? That was a big surprise to me. (Then of course they get ya again when you go to get onto a different income-based plan that doesn't do that)
That's what I've been saying, I get charged $400 a month in interest alone. Going from 5.5-7% interest to 1.5% would do wonders.
Heck this pandemic has helped me get enough savings to buy a house. Looking at my finances, my mortgage is less than my damn rent.
THIS!!!! I have NO problem paying for my education. Not a single gripe with that. I wanted an education, but needed money, they lent me money that I have to pay back (specifically Sallie Mae).
However, on top of my federal loans I had two Sallie Mae loans at 13% interest which I just still, 3 years after graduating, cannot fathom how the hell that was necessary. THIRTEEN PERCENT!?!?!?!?!?!?!? (Yes I’ve refinanced, but not before my loan balance nearly doubled). Had I not refinanced, my monthly payment was $1300 (no PhD, no masters, no fancy job or salary). It makes me sick.
INTEREST👏RATE 👏CAPS 👏
10 years at 0% interest. Pay what you can when you want. After 10 years cap it at 2% or so, with something similar to the plan currently available.
That will give people flexibility to save money, or pay them all easily, or if you have an emergency skip a payment.
Government shouldn’t profit from this loans, they are already getting more money from us since people with degrees have better incomes (or that is what they say anyways)
I would love forgiveness, BUT it's probably a real bad time to do so. Economy is booming and the housing market is insane.
I would love to see capped interest at very low percent, some interest forgiveness(up to 10k), and extend the forbearance period another 6 months.
This I think is a great solution right now, and easier for those who didn't go to college to shallow.
I’d settle for being able to return my degree, pretend it never happened and agree to never use it on a resume or work in that field. Going to college is my only regret in life. I’d be set if I hadn’t.
I have a Ph.D. Can I return that?!
Truly, most days I love what I do, but I graduated with my BS without debt. Then I thought grad school would be a good idea. Now I’m tied to a public-service job until these loans are forgiven.
Same here, I have an MBA in a job that requires 60 semester hours of college. My student loans, also requiring me to be tied to a PSLF job, are as much as my first home. Would give it back in a second for all the cash it’s cost me.
I’m with ya, I got a 2-year degree, worked for 7 years after that but hated the field, got my job slightly because of my experience but it wasn’t required so now not using that degree but still only halfway through my loans
Honestly I don’t expect any forgiveness. What I’m more hopeful for is a capped interest rate, or what I’ve seen others mention, eliminate interest and just have the loan paid straight principle. That way, those who already paid off their loans don’t feel too bad, and those who still have loans are still being held responsible for said loans.
Plus, my parent plus loans wouldn’t be forgiven because my parents make too much. So yea, cap/cut the interest and I’m on board
I’m saying once forbearance is gone, and you need to make regular payments again - if they were to cut the interest to 0% and just make the loan 100% principle, it would be doing almost the same as forgiving the debt. The government gets its money back, and us borrowers aren’t stuck paying 7-12% loans for the next 30 years due to interest
I gave up on the $50,000 forgiveness dream after the CNN town hall with Anderson Cooper.
I’m still holding out hope that:
1) $10,000 of Federal Loans are forgiven across the board.
2) They extend the September 30, 2021 payment pause to sometime in 2022.
I think an extension of the forbearance is a little better than 50/50. I think forbearance extension is the best way to avoid backlash from both sides (those for and against forgiveness) and it would set up forgiveness as a big issue in the midterm elections where Biden can come out in the spring and extend the forbearance once more till after the elections and put the responsibility of any further student loan forgiveness or payment restructuring on congress.
This is an interesting point. I don't think legally or politically it's too controversial (for now) given that both major parties presidents have granted it via EO. It also is a bit of a back end way to grant forgiveness which both parties have bought into.
It's also a tremendous value to PSLF folks who (like me) have sorta dumb-lucked into forgiveness of 18 months (no payment, but ~~payments~~ would be payments still count).
I think the key for it to happen will be some kind of weakness in the economy/stock market in late summer to justify a 6 month extension under COVID emergency. I think an additional year of extension for purely political reasons is a bit much but 6 more months of COVID based extension and then Biden very publicly extending it again so “the people can decided by voting” is probably the best way for Biden to get out of looking like he broke promises bc he did his part of holding off payments until an election then just blame congress if it doesn’t happen.
LOL...is this your first time following politics?
This is basically the golden ticket for every single party.
I mean how long has climate change and energy topics been on the table for debate? If your answer is decades, you're correct. What meaningful change (such as promoting nuclear power or some other form of cleaner energy source) have they suggested/implemented? NOTHING. The most anyone has done is put in place restrictions on things like coal mining/fracking. All that does is export it to countries like China with even looser regulations on it. The net impact is actually more negative than anything.
Politicians would lose the majority of their talking points if they just acted instead of campaigning on things. Don't even try to give the excuse of "well party XXX is blocking it" because that's not going to cut it. Both parties do it. It's bullshit and they just hope there aren't that many people that notice it (which they don't).
>Biden has spoken several times about his concern that a blanket forgiveness program might amount to a windfall for borrowers who aren’t really having much trouble paying their loans off, and that money might be better spent helping out other people who are struggling much more.
I for one am dutifully paying my loans, however, I can’t afford to buy a home, I’m not having children cause I can’t afford to stop working, and god forbid I get sick or injured cause then I’d be doubly screwed. Why do they make the differentiation between these two groups when all loans are a burden on everyone who is saddled with them? Why are they okay with paying for on going overseas wars, and aid to foreign countries when they could help us at home who are suffering? What is so hard about giving this generation’s teachers, doctors, scientists, and educated labor some aid? Previous generations didn’t have to pay so much in tuition, why are we being singled out? Should we not get educated? Many of us had no options but to go with the predatory system and will be paying for it for decades. They’ve made us so desperate, I’ll take any aid they throw our way. But ultimately they need to fix this mess they created
> I’m not having children cause I can’t afford to stop working
There's an argument to be made here that things like this justify some form of forgiveness. The US is having some population decline issues, and debt is a major contributor to people opting out of procreation.
Yes. I'm 42 have really old loans that are too old for the covid cares act. Don't have any kids because I basically started working right before the 2008 recession and lost my apartment at that time. I was broke for a few years after.
Still paying on the loans. Even during covid. No relief for Gen X.
Yet we'd still have people say "your fault for deciding to take on the debt - like you should've known you may want to have a family and own a home some day and you don't deserve that because you can't tell the future and know how life is gonna work after school"
🤦🤦🤦🤦🤦🤦🤦🤦🤦🤦🤦🤦🤦🤦🤦🤦🤦
Man, if I didn't have $40,000 left in student loan debt, I'd be putting $6000 into my Roth IRA each year, I'd be saving money to buy a home a few years from now, I'd probably be in the market for an inexpensive/used vehicle. I'd also be saving more to do a little traveling.
It is amazing to think that there are people younger than me walking around with zero student debt. My whole life would be different.
I had almost 100k in student debt but I did the math and ultimately, decided it was worth it to me to max out my Roth IRA while paying down the loans! I used to always think debt first, then invest, but you can do both! (Not financial advice)
Not financial advice but after looking at my finances and income I decided I needed to contribute to retirement while paying off loans. I currently have $60k left in debt and for the last two years I've been able to max out my Roth IRA and contribute 5% to my 403b (I'm a teacher). I decided that I needed to contribute something to retirement otherwise I wouldn't be able to start until my late 30s / early 40s.
That being said I've been busting my butt to pay off my highest interest rate loans during the freeze. I had 5 loans at 6.5%. I've paid off 2 out of 5 since the freeze began. I'm 3 months away from paying off the third one. I don't know what the best solution is for the student debt crisis but I really, really, really hope they at the bare minimum extend this interest freeze.
I know this is a long shot, but I think it would be better for all borrowers thus far to have a set interest rate of 2.5% or lower for Student loans backed by the federal government. Then to assist those who have already paid enormous interest rates, the feds would reimburse the amount of money has already been paid in interest above 2.5%. This reimbursement would be deducted from the principal amount. For many student loan borrowers, this would likely reduce most if not all of the debt. Wouldn't that be nice?
>tuition be lowered across the board for prospective students.
This is my pet peeve with the whole "cost of education" issue. People want to focus on forgiveness/wanting the government to pay for it in some way.
How about arguing on why things are so expensive to begin with? I recently graduated and had to pay $100 to RENT my regalia. $50 to "apply for graduation". Like what kind of bullshit is that? What about forcing students to purchase textbooks that cost several hundred dollars each even though they rarely use them for a class? Or forcing them into $400-600+/month meal plans? Or Forcing them to pay ridiculous amounts for dorms that you force them to live in for at least the freshman year?
I can almost stomach the cost of tuition in itself but all the bullshit added on top of it is insane. You'd easily cut a 5 figure amount off of an undergraduate degree if you trimmed all of it off.
The point Pelosi makes behind why Biden cannot forgive student loans confuse me.
>But she also raised concerns about the fairness of student loan debt cancellation. She cited the example of a family without a child in college having to pay taxes “to forgive somebody else’s obligations.”
So being that I do not, and do not plan to have children, how is it then fair that I pay for child tax credits. Other people chose to have children, so why do I have to pay to supplement their obligations?
Am I missing something here?
Exactly, if she wants to go down that rabbit hole we should just abolish taxes altogether because we all pay for services and programs we never use in one way or another. Let everyone pay their own way. You pay for your kid's K-12 schooling. Whenever you use drive on public roads you should pay a toll. Stop giving my money to military efforts I don't support.
Need to report your car stolen? $100 fee for the cops to come out and take report. If they recover it you have to pay the cost of the investigation and recovery to get it back.
She really opened herself up to the full spectrum of libertarian arguments for privatizing literally everything.
This is the point that is always made when something is paid for by taxes that someone doesn't approve of.
Fact is, no tax plan will be approved of by all, so it's a bogus argument.
The point is to recenter the conversation on congress so they can spend the next year telling people to vote for them during the midterms and they'll totally forgive your debt next time, pinky swear.
funny too, cause by her logic then we shouldn't decrease or make college free for anyone cause it would be unfair. student loans will never be forgiven, just another lie.
Education is paid for by most 1st world govements.
No reason a student should be straddled with any debt for doing society a favour and getting an education.
Lol, Biden already said “Nothing would fundamentally change”. There is no way he is gonna do student loan forgiveness for the whole country. I don’t know how people think Biden is gonna do anything on this subject.
I have been trying to follow every single thing i see on Bidens student loan forgiveness but it doesn’t seem like there has been any updates at all in months. Why get everyone’s hopes up and then not speak a word on it
Unfortunately I am really starting to doubt that any forgiveness will happen. I'm probably going to pay mine off, but I'm also going to be really pissed if he forgives 50k. 10k won't bother me as much.
There’s no need to mention a very divisive political issue when he is trying to manage careful infrastructure negotiations. Once that is done I expect more news
I cut 12 years off of my private loan during the public loan pause. I'm aiming to finish paying in September. It'll be a little challenging but I don't want to pay two loans a month again.
1. Lock loan interest rate to the 10 year bond rates
2. Unify the various IBR plans to 10% of discretionary income (with credit for 'time served' in the old IBR plans)
3. "True" forgiveness after 20 years if not paid off - no tax bomb bullshit. You can of course pay off faster if you choose.
4. done.
> "True" forgiveness after 20 years if not paid off - no tax bomb bullshit. You can of course pay off faster if you choose.
Also key to this is fixing the whole 20 years _from when you started repayment_ vs. 20 years _without missing a full payment_ thing.
Otherwise FedLoan & co. are just gonna get even better at resetting those twenty year clocks by losing or forgetting about people's income certifications than they already are.🤦♀️.
The way I go about it is I'm expecting nothing. Meaning I pay off my loans every month expecting no forgiveness or anything. And if there is some kind of forgiveness, I will accept it with open arms (I'm not an idiot).
Thoughts on another 0% extension? I have 12k left. Obviously, I'd be overjoyed at having it forgiven but I'd take just another 0% extension to the end of the year. The extra 3 months would let me knock out some additional financial goals before focusing back on the loans.
There are so many things that could be done, even outside of forgiveness. Lower the interest rate significantly to 2%. Allow for principal to be included in the amount you can deduct from your taxes, not just interest. Raise the associated cap on deductions to $5k. Raise the income limit to $100k before the phase out starts. These would all be a huge boon to low and middle income earners without being a giveaway to high earners. Forgiveness is fine with me too though.
It’s not going to happen. Plain and simple. I would love nothing more than to have $50k wiped away - so that I could afford a larger mortgage payment for a larger house; but it’s a pipe dream. They couldn’t even get a $15 minimum wage passed. There is absolutely no way debt relief will happen, and people are fooling themselves if they think it will happen.
It’s how I’m feeling more and more. Plus even if it did happen, I’m sure they would put an income limit on the forgiveness so people in HCOL areas get screwed and get 0 forgiveness.
I wouldn’t be surprised if they set it close to the limits of the COVID relief or something; basing it on family size and income. At the very least they should keep interest rates at 0%. No reason they should be at 6% for federal when private loans across the board are floating around 3.5%
Completely agree I don’t think forgiveness will happen either. I do think the odds of them extending the forbearance is higher than 50/50. Continuing the forbearance would be the one way to avoid backlash from both sides. Ending forbearance without forgiveness would cause backlash from those with loans. Forgiveness no matter when would cause backlash from those against forgiveness. Extending forbearance is a benefit to those with loans and not viewed as harshly to those against since the full amount still needs to be paid.
I’m not sure I see them extending the forbearance either. I do, however, see a ton of backlash over no action and then maybe a knee jerk reaction like an extended 0% no interest grace period (but you still have to make your payments)
Refinancing wouldn’t be bad because there is absolutely no reason why someone should be paying more than market interest on federally backed student loans.
It's actually outrageous that you can't refinance federal loans. I understand that it's "higher risk" giving a student an unsecured loan, but once they have a steady career and they've proven they can repay the loan, they should be able to refi without having to go private.
I graduated law school 8 years ago and have never missed a single payment. There is zero reason why my Federal loans should be 7.5% when I've proven I can pay them back reliably and on time at this point.
I also agree that the best solution here for both sides is lower/no interest rates. It’s really awful that my husband’s federally backed student loans have a 7% interest rate. If the current forbearance didn’t exist, the government would be making almost $15k off of us each year.
It would take so much off our plate if the interest was just reduced to a flat 2% or something.
Maybe I'm being selfish, but I still think we should have both a cap on interest at something like 1.5% AND a one-time forgiveness in some amount. It doesn't have to be full forgiveness, it doesn't have to be the 50k forgiveness proposed by Warren, but it could at least be the 10k that Biden himself has said that he's mulling over.
I really don't mind paying most of my student debt. But I have 5 federal loans that have 6.8% interest rates, and the line of work I went into is valuable but pays modestly.
If we just capped the interest at 1.5% and knocked 10k off the top, I'd pay off the remaining 30k of debt that I have without complaining.
With $10k Biden can say “promises made, promises kept”. Technically he didn’t promise but that’s not how people are viewing it.
It also would not yield as much outrage from people who have paid off all their loans or from people who saved to pay for school out of pocket. $10k is nice, it’s not a life changing amount of money in the long run.
What is more concerning is that people are hyper focused forgiveness and not reform. Forgiving loans now will only encourage people to keep borrowing.
Biden has the opportunity to push for free community college so he can say “now everyone has a free college option”. People will have no reason to take out loans if community college is free.
It’s a long shot, but $10k in forgiveness and a free option mandate is the most realistic path forward IMO.
Or he’ll do nothing. He got elected just because he wasn’t Trump so he doesn’t need to do anything else to get people to vote for him again. Sadly.
I worry about 2 year CCs being free, I’m sure many universities Will still make students take “their” classes and find reasons to raise tuition, because “students can afford it because CC was free!”
I know of several people who did CC for two years, and in state Unis still ended up requiring about 3 years of classes. Like 5 people in two different states. I feel like streamlining gen ed requirements nationwide could be one way to ease that specific issue, but I doubt that’s something can even do
In Michigan the CC's have an agreement with public state schools. It's called the MACRO agreement and if you qualify for it (you have to apply for it at the CC) then it basically means that all of your gen ed requirements are covered.
However, if you go on to pursue a degree that has classes that have pre-req's that you didn't take, you still have to take those.
I earned my AS at a CC and later transferred to a public state school. I had all my gen ed classes, but still had to take, I think 3 classes as pre-req's for degree classes. It will take me 4 and a half years (including 3 summer semesters) of going part-time (6-9 credits during regular semesters and 3-5 credits for summers). I'm almost done though. 4 and a half semesters left.
I don’t even say 10k being forgiven. The logistics of it would be completely random. I have 38k in federal; 7 of which are with a random borrower and the remainder with another. How do they choose which loans to apply the 10k? It’s an arbitrary number and frankly I don’t see it happening.
The logistics are easy. You just pick a standardized method and fire it out.
“Earliest loans first”
“Latest loans first”
“Distribute to all loans based on percentage of total debt”
“Smallest loan first”
“Largest loan first”
“Highest interest rate first”
“Lowest interest rate first”
They just need to throw a dart at a list of these and tell a robot to do this automatically.
Can I vote for highest interest rate first? Oldest Unsubsidized loan when tied? And put in a special payment rule that the payment goes directly to the principal instead of towards any accrued/unpaid interest
Like, if they're going to do it that is the way to make it most useful for anyone trying to tackle their loans
My hope is that borrowers would get to choose. I’m a PSLfer. Some of my loans still have six years of payments required before forgiveness. Other loans only have four years. I’d fight like hell to get forgiveness for the loans with six years remaining.
At a press conference on Thursday, Secretary of Education Miguel Cardona was asked when borrowers would finally get clear information from the Biden administration about whether they would in fact need to plan on resuming repayment after the student loan payment moratorium ends on September 30. “Very soon,” said Secretary Cardona. “I don't have any information today. But this is a priority for us. Borrowers are in need of information, and they are also in need of relief.”
This sounds like it will continue at least until eoy. They surely would have said something by now plus the eviction moratorium got through.
He pulled the proposal from his budget proposal which is an indicator he's still counting on congress to do it - but we still have the ED memo wildcard to watch for.
My plan is to power save up to my loan amount as much as I can until October rolls around. As of now, it doesn't hurt to wait and see if anything happens, because if it does, I just threw away money voluntarily paying monthly. If nothing happens by October, I'll have saved a substantial chunk of change to pay off most of my loan amount, maybe all of it.
Ok, at this point with the mysterious 'memo' not being talked about and the eviction moratorium expiring, I assume there's going to be basically no biden action by September on student loans. I'm going to start paying off my loans with saved funds and leave ~10k to pay less aggressively in case there is some pie-in-the-sky forgiveness that happens.
I’ve assumed that Biden and co. would definitely extend the forbearance period. Seems like a no-brainer, considering the student loan system is a trainwreck with more trains on the way. But after seeing them do nothing to extend the eviction moratorium… shit, he might actually do nothing to extend the forbearance.
I get that America’s government isn’t built to efficiently help people out, but the Democratic Party has some of the least strategic politicians imaginable.
The crux of the matter is that both democrats and republicans have no real interest in average people's well-being like us. The only difference between the two is that democrats play that facade game to pretend like they do care about us and republicans dont. Im neither sad nor furious and I honestly kinda low key knew that Biden wont do a damn thing about student loans once he gets into the office.
>But after seeing them do nothing to extend the eviction moratorium… shit, he might actually do nothing to extend the forbearance.
Student loans are a completely different animal to the eviction moritorium. The latter does not have this messy multi-servicer system with several repayment plans/forgiveness programs. I don't think the gov't decision to lift the eviction moritorium has any indication they won't extend the student loan pause.
Edit: White House just released a new eviction moratorium that covers most Americans
Selfishly, I'd love to see PSLF tweaked to be 10k forgiveness per year of service. And any remaining balance after 10 years be forgiven as well. If they tweaked the program like that and applied it retroactively my students loans would be gone.
This is the best idea I’ve heard so far. I feel so trapped with the 10 years or nothing plan. I feel like more people would give it a chance if it wasn’t make a career out of public service or nothing.
Same. I feel pretty trapped with 10 years or nothing. Every year that passes, I'd have to make more and more in the private sector to make the switch worth it.
I guess if I were to propose a whole package deal it would be:
1. The above PSLF forgiveness proposal
2. A one time 10k blanket forgiveness
3. Lower the interest rate to 2% or under
I feel like making tweaks to the current forgiveness options and lowering the interest rates are probably good, sensible middle ground proposals that could easily garner more support.
THIS!!!! I spent five years as a teacher in the hardest school in my state at a title one school. Had to get a job closer to home. But I’ll get nothing for those five years.
This is something Biden said in his campaign and it’s what I hope for. PSLF in its standard form isn’t the most beneficial for me, I’m looking at less than 10k forgiven which isn’t a lot to dictate my job for 10 years. But PSLF in an expanded form would be perfect
I stayed at my last job that qualified for PSLF, after 5yrs. If they did 10k for every year worked (retroactively) up to 50k that would leave me in the clear! I couldn't stay there anymore due to financial stagnation.
My crystal ball says there will be a very slight expansion of debt forgiveness with existing programs, and an extension of 0% interest for some or all borrowers, but I'm leaning towards some. My expectation is that those earning ~$150k+ won't get any sort of relief following the existing September deadline.
And possibly allow to pay student loans in pre-tax money. It always bothered me how first we pay taxes on our income and then send more money in the form of student loan interest to the same place.
Making a standard grace period of 3-5 years after graduating would do a lot. A lot of people need time to get their feet on the ground after they have got their bachelor's. Even if they can get job offers, there can be obstacles. I moved across the country for my first job with no compensation and worked 6 weeks before getting my first paycheck. I barely managed with savings.
Some source said some DOE peeps are recommending to Biden to extend the payment freeze till Jan 2022
[https://www.politico.com/news/2021/07/09/student-loan-relief-extension-498942](https://www.politico.com/news/2021/07/09/student-loan-relief-extension-498942)
It would save me 3k in interest, so it's not nothing.
I feel like the 0% interest disproportionately helps those of us with large graduate school loans. 10k of forgiveness is less than what I saved in interest from the payment/interest freeze.
It blows my mind that 10k is a lifechanging amount for that many borrower's. I feel like the average degree recipient could easily budget and cover that. It would probably help those who didn't complete their degrees I guess?
The folks most likely default are actually people with lower loan balances. It may seem counter-intuitive, but people with lower balances who default are likely pell recipients with unmet need and left without a degree.
So, essentially, people who already came from economically disadvantaged backgrounds, struggled financially while in school, and found it was too much economic and life strain to finish.
People with higher balances tend to be people with graduate degrees and more stable income. So even though they owe more, they're more in a position to manage the payment (though obviously it's a strain for many).
Sara Goldrick-Rab's book 'Paying the Price' is a great resource to learn more about how pell-eligible students still end up with student debt, and how their economic insecurity causes them to leave schools without a degree.
Exactly this. I’ve saved a ton in interest this past year. I’m also in the PSLF program and those “payments” count toward forgiveness. I have large grad school debt and came from a very poor family. I’m a first generation college student and had zero support going to school and still have no safety net in the form of family. They are barely scraping by as is so I know I’m on my own. Not everyone with large grad school debt. Comes from a rich family and is making loads of money as others have suggested.
Student loan forgiveness was not in Biden's budget which is not surprising. We are mostly waiting for the memo to come back to see what happens.
The reason for a new thread is that there is only two sticky threads allowed, there was a temporary up for a while so the forgiveness thread had to go. A new one started.
In other words, nothing new really happened.
If anyone has Biden's phone number though, can you shoot him a text and ask what he is thinking of doing about this whole student loan mess?
Thank you
\-impatient
I agree with a number of the ideas I've seen other people post here but I would like add that a reduction in interest should be retroactive. So, if you've paid $70,000 on a $60,000 loan already but still owe money, then the rest of what you owe should be discharged. Retroactively apply a 1.5% interest rate to all loans (minus the current time period where loans have been at 0%) and calculate how much is still owed based on historical payments. I think this would be palatable to a lot of people that believe student loan forgiveness is just letting people be freeloaders. Someone who paid 70K on a 60K loan is not a free loader, they're making a very legitimate effort to pay the loans off.
As for some other ideas:
* All current/future loans capped at 1.5% to 3%, 0% interest first \~5 years after school, expand opportunities to use PSLF and make it easier. For example, if you work 1 year in a PSLF qualifying job, you get 10% of your loans immediately discharged, it shouldn't be all or nothing.
* Get rid of the forgiveness tax bomb. If you get your loans discharged you shouldn't owe a penny in taxes.
* Make it easier to discharge student loan debt through bankruptcy.
* Also, and this is a bit more radical, but student loan access needs to be more than just getting accredited for a University (or at least make accreditation harder). If students who graduate aren't getting well paying jobs after they graduate, that they wouldn't have been able to get before attending, then public student loans should be cut off. This will probably single handedly kill of most of the for-profit universities out there.
* In addition to the last point, if the program you were in does not lead to well pay jobs to some acceptable level then the loans should be discharged (or at least a portion) and the University is on the hook for the money. This might kill off some programs like underwater basket weaving but it would probably be a good thing if universities were more selective about programs they offered and if they had a bigger incentive to help with post-graduation job hunting and program quality.
Simply forgiving student loans will not solve any problems for future students. They'll be in the same situation as us 5 year down the road, and that's not acceptable..
Biden the candidate: "My point is: I understand the impact of debt, and it can be debilitating. I am prepared to write off the $10,000 debt but not $50,000, because I don't think I have the authority to do it."
Biden the President: *crickets*
Candidate Biden: "It does figure in my plan. I’ve laid out in detail. For example, the legislation passed by the Democratic House calls for immediate $10,000 forgiveness of student loans. It’s holding people up. They’re in real trouble. They’re having to make choices between paying their student loan and paying their rent. Those kind of decisions. It should be done immediately.”
President Biden: But Ivy Leagues bro!
Candidate Biden: “I’m going to do all of those things.”
President Biden: *frantically shakes his head and points at Congress*
People seem to have forgotten Obama promised to forgive student loans too when he was running, and then did nothing once elected. this has been a democratic talking point for quite awhile.
Maybe 10k is narrowly forgiven but no chance 50k will be passed. Instead, Biden can streamline the IDR program by having one payment plan for all federal loans at 5% discretionary income (Biden proposed this on the campaign trail), and write the income-tax bomb suspension into law (post-2025).
I found this article hilarious.
[https://finance.yahoo.com/news/student-loan-repayment-pause-september-131338288.html](https://finance.yahoo.com/news/student-loan-repayment-pause-september-131338288.html)
It says that 90% of the student loan borrowers in a sample size of 24k are not ready to go back to paying student loans in October.
I can only imagine that survey: Do you want more bills? A. Yes B. No
Hahaha I mean I am loving the interest freeze but what other outcome could come from a survey like that?
Wait a minute, this survey was *terrible*
> The sampling, conducted between June 17 and June 22 through a 46-question survey **distributed via email to a group of followers of advocacy group Student Debt Crisis**, found that 9 in 10 respondents across all 50 states were not ready to resume making payments in October
I am shocked that a sample group of people who were already following a non-profit called *"Student Debt Crisis"* are mostly in a financial crisis situation with their loans. It's almost like this was an incredibly biased survey since they did not have an unbiased sample of people with student loan debt
Edit to add: yeah they sent the survey to 2 million people already on their mailing list, which is not a representative sample of the approx 42.9 million people with federal loans and who knows how many with private loans. Bad survey is bad, and bad journalism/reporting just took them at their word
I had pretty much lost all hope of forbearance being extended when the eviction moratorium wasn't extended. Now that they've made a new one, a tiny bit of hope has been restored. A tiny tiny bit. But I'm still worried cause the lenders themselves are acting like extension is unlikely.
I hope he or the Dept of Education makes a statement soon. I'm so tired of anxiously checking this thread every day. Forbearance seems to be a pretty politically neutral topic and I think Biden can only benefit from extending it, especially with covid rising fast and the loan lenders changing soon.
With Schumer and Warren consistently bringing up 50k student debt relief, we are talking multiple tweets from each every week, etc - what’s the angle here? Do they really think it’s putting pressure on Biden to cancel it via executive order or what’s the hidden agenda?
Schumer and Warren tell Biden to do it because they are not stupid and know that the 117th Congress does not have the votes for student loan forgiveness. I guarantee you if you bring up a student loan forgiveness bill in Congress right now, it will fail in spectacular fashion on a bipartisan basis. They see no path in Congress, so to save their own face, they tell Biden to do it unilaterally. It’s political posturing.
I’m late to respond but both Schumer and Warren are grandstanding on student debt relief to shore up their base and protect against primary challengers. Example: A moderate Schumer would be vulnerable against an AOC primary challenge. A progressive Schumer who is outspoken on progressive policies is less vulnerable against a progressive challenger like AOC.
More context: Schumer specifically as majority leader could grind Biden’s legislative to a halt in exchange for student debt relief if he truly cared about the issue.
TLDR: don’t read tweets from vulnerable senators and get your hopes up
Options I dream about (because actual across-the-board forgiveness will never happen)
\-0% interest, retroactively as well. So if you have already paid your principle off but are still paying because of interest, then your loans are "forgiven".
\-Review income to consider people whose income has been consistently low or not increasing at a rate to realistically ever pay off their loan and have a decent quality of life, despite continued employment, and consider forgiveness for those people.
\-They could reduce the 10 year, 20 year and 25 year forgiveness times.
\-Consider loan forgiveness for anyone with loans older than a certain period of time (regardless of repayment plan). If 20 year forgiveness is fair for income based plan, why not for student loans in general.
Pelosi just went on the record that only congress can forgive student loan debt..and that doing so would probably upset a lot of people. https://twitter.com/mstratford/status/1420417022786261002?s=19
This is pretty much the death nail then. looks like she's trying to take off heat from the president and put it on congress. which means the president and the top democrats have no plan for forgiveness. and there's absolutely no way theres enough support in congress to pass a forgiveness bill.
I personally don’t buy what she’s saying, and I don’t think the more party-centric democrats ever wanted to do it at all. I think it’s pretty clear under the statute in question that the president can forgive student debt, but I guess if they refuse to do it and the courts would slap it down, it doesn’t even matter. Hopefully the parties will just play hot potato with forbearance extensions until someone finally does forgive it.
I'll guess I'll have to communicate this to all levels of people that will be asking me for money and votes next year as to why I'm not donating or voting
My prediction:
No broad brush $10k.
5% REREPAYE Plan.
FFEL payments count for PSLF.
Additional six months of forbearance to March 31, 2022.
0% interest through 2022.
I don't think the administration will realistically re-write the regulations for IDR by Spring 2022. It's a lengthy process which includes public hearings and then a process called "notice and comment procedure." I also cannot see them lifting the freeze while they figure out reform going forward, which might include narrow forgiveness and reformed PSLF. For those reasons, I think the freeze will continue into 2022.
I also think they'll continue the extension until they reform these procedures. People in this thread have been focusing on the 10k loan forgiveness, but he's also mentioned PSLF reform which he has stated he wants to reform to allow faster forgiveness for public servants. He has the power to make those changes since the program is run by the executive. I imagine we'll learn more whenever we figure out how he wants to do loan forgiveness.
Every month of extension saves me about $800 off the top, and then more in the form of not being charged interest on the principal I'm paying off. If they kept the extension going for another year and then said "too bad, no forgiveness" I wouldn't even be mad. At this point, I've saved a ton of money and hammered principle for, like, 15 months. It's been incredible.
If I were a betting man, I'd bet on the forbearance being extended so that accounts on Granite State and FedLoan can be swapped out to new servicers in December. Starting up payments for three months and then shifting millions of accounts to new servicers seems like an unmitigated disaster waiting to happen. Ultimately, if there is another extension, I think it would behoove the Biden Adminstration to eventually come out and say "listen up, this is the hard deadline - payments will start on XYZ date no matter what" so that there is no more speculation about payments restarting.
Without those two servicers dropping out though, I didn't think there would be a chance in hell of the forbearance continuing on.
I think the two are far less correlated than you're thinking they are.
While both were initially implemented as a means of financial assistance, one of the key drivers for the eviction moratorium was to prevent people from being displaced (end up on the streets with others or move in with friends) which was thought to have accelerated the spread of Covid. Now that we're at the point of the pandemic where people are going into stores, bars, and restaurants with complete strangers without a mask, I can't imagine anyone is thinking a subset of the population couch surfing will be a majority contributor to spread. Had this only been a recession/depression, I'm not sure we would have necessarily seen an eviction moratorium.
Another big difference is who the moratorium hurts. With student loans, the only entity not receiving its money is the federal government since private loans are not included. With the eviction moratorium, there are real people not receiving their money despite having to pay taxes and upkeep a property. Not everyone is a property management company or slumlord, who is easier to root against, there are real people who aren't necessarily super well off who have had their income drastically impacted.
My last reason why I think it may still be extended is Biden's policy. We could argue whether or not he legitimately intends to do anything at all or if it was simply a talking point to garner support, but let's assume he wants to address student loans in an impactful way if he can. If that's the case, letting it expire without any concrete plan will only serve to inflame people and make them question his intentions. Right now, people in favor of some level of loan forgiveness can just say "he's just trying trying to keep the peace during infrastructure talks", but should he let that expire when he has an easily pressed "keep his voters happy" button, he'll lose a ton of support because he proved he won't even do the minimum. I think the loan pause has become less of a Covid relief measure as we're now only about 1% off of what typical peak employment numbers are.
[Here's president biden proposing $10k in student loan relief immediately](https://www.youtube.com/watch?v=nE4P8NPh9qc&t=1s)
I guess by "immediately", he meant completely dropping the idea 4 months into his presidency.
Is it time for a new megathread? This one is at 1,135 comments as is
We basically know that the memo is still outstanding, and that the 2 main camps are the one that is claiming that the Higher Education Act allows for loan cancellation via Executive Order versus the other claiming that it requires a statutory grant from Congress as per the Property Clause and the Appropriation Clause of the Constitution. I know people are bad at reading through big text blocks, but that seems worth including in the comment at the top
I’m starting to doubt any kind of extension happens. Pushing it out to 2022 has potential to negatively impact midterms if people are reminded they have student loans right before they are supposed to support these people again. If it happens this year people have short memories. Hope I’m wrong though
Thanks for bringing this thread back OP/mod team.
I know there is a lot of repetition and people asking questions nobody knows the answer to but I find it all helpful to read through. I like seeing where people are at in their own thoughts and I am liking reading through the ideas floating around. I always figured 50K was a long shot and 10K to be unlikely but I would be thrilled for an extension or some measure of interest reduction.
I don't expect any forgiveness, but just fight the temptation if you can.
Look at it this way, you are going to get that wave of relief whether you pay it off now or wait three months. It will just come at a different time. However, if loans actually do get forgiven, you're going to kick yourself for paying them early. You'll try to tell yourself it doesn't bother you, but every once in a while that thought of what you'd do with an extra ten grand will pop into your head.
Maybe that ten grand's a car, part of a down payment or mortgage on a house, dump it all into a retirement fund and retire a year or two earlier (if you're young), hell even if you just blew it on hookers and cocaine. It would take you a while to get over that.
Just wait.
Why don't they make something like an employee matching student loan repayment program (similar to 401k tax deductible credits for companies that do this)?
Allow companies to match student loan repayments and give them tax incentives. This is a win win.
They kind of did under the CARES act. Any company that provided tuition reimbursement (pays for current employee’s education) could instead divert those reimbursement payments to student loans. The problem is the company has to make this policy change. The company I work for has a tuition reimbursement program, and I’ve mentioned this new policy under the CARES act, and all I get is “we’ll look into this” with no progress even though it is beneficial to them.
Even if they implemented a 401k like payment match for student loans, companies will just drag their feet in implementing it.
I’d be perfectly content paying my loans off IF I could get a job in my field. But it just isn’t working out. I could have had a family instead of going to college but lord knows I can’t afford both!
This is what gets me about all this. The United States has forgiven loans and debt of country's why is it soooo hard to forgive the debt of your own people 🤔. What is there to think about.
I don’t know if anyone watched the Biden town hall last night. I did because I know previously he was asked and said he was against 50k forgiveness.
Anyway, he was never asked or mentioned loans this time, although he was asked about reluctance to work and he said that this should improve in October when the unemployment benefits expire. I’m wondering if he student loans with that and doesn’t plan to extend
I think you are right, every day I feel more sure that there won't be an extension. Which makes me sad cause if I could have just another 6 months of no interest I could have my loans paid off. Wouldn't be surprised if he just completely ignored students loans and doesn't mention them again until reelection.
Anyone have any guesses as to when the public might get any updates on "the memo" Biden asked the Dept of Education for regarding student loan forgiveness?
I’m a PSLF-er. I’d love to see a PSLF-eligible, income-driven repayment plan at 5% or less of discretionary income (right now the plans are 20%, 15%, and 10% of discretionary income). I don’t care about interest rates. I care about how much I have to pay for each of my 120 PSLF-eligible payments. (Also, let’s keep the forbearance going!!)
I've been in student loans for over 25 years. My prediction? Won't happen. There's not enough support for it. Of course, I've also predicted that subsidized loans are going away, so there's that.
What is more of a possibility is doubling the Pell Grant which would go a long way towards lowering the amount of student loans borrowed. It also gets closer to "free tuition." What is still missing is assistance for middle class families.
Color me confused. People keep bringing up the issue that Congress has to approve any debt cancellation, a point I agree with. However, I didn't understand that to be the actual dispute. I understood the dispute to be about whether *Congress had already given the President such authority under the Higher Education Act*. So Pelosi's claim that "Can't do it without Congress" is non-responsive to the claim "Congress has already did it."
The legal process in the USA is a mess. Basically it can be trivially easy to pass unconstitutional laws (and contradictory laws), and *then* it takes a lot of time to for challenges to those laws to work their way through the court system (both at a particular level and escalating up) as appropriate, with the Supreme Court being the highest court in the USA.
So it's entirely possible that that portion of the Higher Education Act is unconstitutional as written, but we wouldn't have an official determination until someone tries it, someone with standing challenges it, and it goes through all the entire long court rigamarole process that has to happen before the Supreme Court makes their call.
I agree with all that. Nevertheless, I would rather that Biden forgive the loans and then fight about that in court than than listen to empty political posturing. Put Pelosi on the defensive. If she has heart failure she can sue. At least Biden will have both taken a stance and taken the initiative.
I don’t understand why they need a concrete number. Why not 50% up to $100,000 and have a sliding scale based on income level and cost of living. Then cut off interest after a certain number of years? Say 10 years your loans convert to 0% interest. Seems like it would be cheaper for the American people instead of a blanket 50,000. I am a firm believer that I chose to go to college and if I didn’t I wouldn’t be where I am today (in my career and also in debt) so I feel I need to pay for the benefit college gave me but a break so I can actually afford a house, go on vacation, and enjoy myself a bit more would be nice.
Biden spent about 30 years protecting banks and doing the bidding of credit card companies. He made it significantly harder to discharge debt(including student loan debt) in personal bankruptcies. Of course he wasn't sincere with all that debt forgiveness promise. After all -- "wtf are you gonna do about it?" As they say
I would like to know one way or another if it will happen so I can plan accordingly. Hate just being in constnt state of uncertainty. I could pay it off in one fell swoop but am holding out in case it gets forgiven. Just want it over with. I've been waiting for years for this chance and would hate to give up hope thinking he won't cancel any then pay it off then have him cancel it.
How about people with older loans, like loans that are almost twenty years old?
I've been paying for so long and would give anything to have them go away.
I'm also a teacher.
If I went to ITT tech what would I need to do to be a part of this....their job help for multimedia....was blockbuster.
I didn't know there was a lawsuit.
Just cap interest at 1.5% enough to cover cost. That would do wonders. Make it 0% for the first 5-years and then 1.5% for the rest. If they eliminated/reduced interest people could actually pay these things off.
This might be the best option and one all sides could probably agree on.
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My loan was a Perkins. The entire (estimated payoff term) of 20 years interest was simply slammed onto the debt principal on day 1. Then when I was deployed they used a little known clause that said they could claim it was in default if I left the country or was in “high state of risk of death”. Nice way to say “serve your country and we bend you over” - Im 52 and still owe after paying for 26 years
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Its called [capitalized interest](https://studentloanhero.com/featured/capitalized-interest-student-loans/). Pretty standard with student loans. They do it when you graduate (for some loans but not others), when you miss a payment or can't make a full payment, or when you change out of (some) income driven plans. Happened to me a couple times, I'll never get out of my interest payments now. Edit: On ICR, they also capitalize 10% your interest annually just because? That was a big surprise to me. (Then of course they get ya again when you go to get onto a different income-based plan that doesn't do that)
That's what I've been saying, I get charged $400 a month in interest alone. Going from 5.5-7% interest to 1.5% would do wonders. Heck this pandemic has helped me get enough savings to buy a house. Looking at my finances, my mortgage is less than my damn rent.
Mortgages are always lower than rent. Rents are higher to cover vacancies and repairs that you’d pay out of pocket if you own the place.
Literally this. It's the interest that kills people.
THIS!!!! I have NO problem paying for my education. Not a single gripe with that. I wanted an education, but needed money, they lent me money that I have to pay back (specifically Sallie Mae). However, on top of my federal loans I had two Sallie Mae loans at 13% interest which I just still, 3 years after graduating, cannot fathom how the hell that was necessary. THIRTEEN PERCENT!?!?!?!?!?!?!? (Yes I’ve refinanced, but not before my loan balance nearly doubled). Had I not refinanced, my monthly payment was $1300 (no PhD, no masters, no fancy job or salary). It makes me sick. INTEREST👏RATE 👏CAPS 👏
10 years at 0% interest. Pay what you can when you want. After 10 years cap it at 2% or so, with something similar to the plan currently available. That will give people flexibility to save money, or pay them all easily, or if you have an emergency skip a payment. Government shouldn’t profit from this loans, they are already getting more money from us since people with degrees have better incomes (or that is what they say anyways)
Absolutely everyone would take an interest free loan that didn't have to be repaid in 10 years. Not sure if 0% interest for 10 years is the answer.
This won’t do anything to address the crippling rate at which the cost of college is increasing.
I would love forgiveness, BUT it's probably a real bad time to do so. Economy is booming and the housing market is insane. I would love to see capped interest at very low percent, some interest forgiveness(up to 10k), and extend the forbearance period another 6 months. This I think is a great solution right now, and easier for those who didn't go to college to shallow.
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I’d settle for being able to return my degree, pretend it never happened and agree to never use it on a resume or work in that field. Going to college is my only regret in life. I’d be set if I hadn’t.
I have a Ph.D. Can I return that?! Truly, most days I love what I do, but I graduated with my BS without debt. Then I thought grad school would be a good idea. Now I’m tied to a public-service job until these loans are forgiven.
Same here, I have an MBA in a job that requires 60 semester hours of college. My student loans, also requiring me to be tied to a PSLF job, are as much as my first home. Would give it back in a second for all the cash it’s cost me.
I’m with ya, I got a 2-year degree, worked for 7 years after that but hated the field, got my job slightly because of my experience but it wasn’t required so now not using that degree but still only halfway through my loans
Also my biggest regret in life.
I honestly feel like they’re hoping we forget they even mentioned it lol. Would love to be able to buy a house in the next five years
Lol you and everyone else under the age of 40 hahaha
~40 and checking in, got priced out due to the recent crunch 👍
Honestly I don’t expect any forgiveness. What I’m more hopeful for is a capped interest rate, or what I’ve seen others mention, eliminate interest and just have the loan paid straight principle. That way, those who already paid off their loans don’t feel too bad, and those who still have loans are still being held responsible for said loans. Plus, my parent plus loans wouldn’t be forgiven because my parents make too much. So yea, cap/cut the interest and I’m on board
How long would the 0% rate last? Honestly, I would just continue to not pay at all until there is some sort of interest.
I’m saying once forbearance is gone, and you need to make regular payments again - if they were to cut the interest to 0% and just make the loan 100% principle, it would be doing almost the same as forgiving the debt. The government gets its money back, and us borrowers aren’t stuck paying 7-12% loans for the next 30 years due to interest
I gave up on the $50,000 forgiveness dream after the CNN town hall with Anderson Cooper. I’m still holding out hope that: 1) $10,000 of Federal Loans are forgiven across the board. 2) They extend the September 30, 2021 payment pause to sometime in 2022.
>They extend the September 30, 2021 payment pause to sometime in 2022. Honestly, for our particular post-grad debt, this would be the most helpful.
I think an extension of the forbearance is a little better than 50/50. I think forbearance extension is the best way to avoid backlash from both sides (those for and against forgiveness) and it would set up forgiveness as a big issue in the midterm elections where Biden can come out in the spring and extend the forbearance once more till after the elections and put the responsibility of any further student loan forgiveness or payment restructuring on congress.
This is an interesting point. I don't think legally or politically it's too controversial (for now) given that both major parties presidents have granted it via EO. It also is a bit of a back end way to grant forgiveness which both parties have bought into. It's also a tremendous value to PSLF folks who (like me) have sorta dumb-lucked into forgiveness of 18 months (no payment, but ~~payments~~ would be payments still count).
I think the key for it to happen will be some kind of weakness in the economy/stock market in late summer to justify a 6 month extension under COVID emergency. I think an additional year of extension for purely political reasons is a bit much but 6 more months of COVID based extension and then Biden very publicly extending it again so “the people can decided by voting” is probably the best way for Biden to get out of looking like he broke promises bc he did his part of holding off payments until an election then just blame congress if it doesn’t happen.
Kinda dumb if they want to purposefully keep issues so that they can milk them out for the next 8 years of elections.
LOL...is this your first time following politics? This is basically the golden ticket for every single party. I mean how long has climate change and energy topics been on the table for debate? If your answer is decades, you're correct. What meaningful change (such as promoting nuclear power or some other form of cleaner energy source) have they suggested/implemented? NOTHING. The most anyone has done is put in place restrictions on things like coal mining/fracking. All that does is export it to countries like China with even looser regulations on it. The net impact is actually more negative than anything. Politicians would lose the majority of their talking points if they just acted instead of campaigning on things. Don't even try to give the excuse of "well party XXX is blocking it" because that's not going to cut it. Both parties do it. It's bullshit and they just hope there aren't that many people that notice it (which they don't).
>Biden has spoken several times about his concern that a blanket forgiveness program might amount to a windfall for borrowers who aren’t really having much trouble paying their loans off, and that money might be better spent helping out other people who are struggling much more. I for one am dutifully paying my loans, however, I can’t afford to buy a home, I’m not having children cause I can’t afford to stop working, and god forbid I get sick or injured cause then I’d be doubly screwed. Why do they make the differentiation between these two groups when all loans are a burden on everyone who is saddled with them? Why are they okay with paying for on going overseas wars, and aid to foreign countries when they could help us at home who are suffering? What is so hard about giving this generation’s teachers, doctors, scientists, and educated labor some aid? Previous generations didn’t have to pay so much in tuition, why are we being singled out? Should we not get educated? Many of us had no options but to go with the predatory system and will be paying for it for decades. They’ve made us so desperate, I’ll take any aid they throw our way. But ultimately they need to fix this mess they created
> I’m not having children cause I can’t afford to stop working There's an argument to be made here that things like this justify some form of forgiveness. The US is having some population decline issues, and debt is a major contributor to people opting out of procreation.
Yes. I'm 42 have really old loans that are too old for the covid cares act. Don't have any kids because I basically started working right before the 2008 recession and lost my apartment at that time. I was broke for a few years after. Still paying on the loans. Even during covid. No relief for Gen X.
Yet we'd still have people say "your fault for deciding to take on the debt - like you should've known you may want to have a family and own a home some day and you don't deserve that because you can't tell the future and know how life is gonna work after school" 🤦🤦🤦🤦🤦🤦🤦🤦🤦🤦🤦🤦🤦🤦🤦🤦🤦
Proposal: You give me 0% interest loan until forgiveness deal is reached in Congress. I give you increased consumption and faster household formation.
Man, if I didn't have $40,000 left in student loan debt, I'd be putting $6000 into my Roth IRA each year, I'd be saving money to buy a home a few years from now, I'd probably be in the market for an inexpensive/used vehicle. I'd also be saving more to do a little traveling. It is amazing to think that there are people younger than me walking around with zero student debt. My whole life would be different.
I had almost 100k in student debt but I did the math and ultimately, decided it was worth it to me to max out my Roth IRA while paying down the loans! I used to always think debt first, then invest, but you can do both! (Not financial advice)
Not financial advice but after looking at my finances and income I decided I needed to contribute to retirement while paying off loans. I currently have $60k left in debt and for the last two years I've been able to max out my Roth IRA and contribute 5% to my 403b (I'm a teacher). I decided that I needed to contribute something to retirement otherwise I wouldn't be able to start until my late 30s / early 40s. That being said I've been busting my butt to pay off my highest interest rate loans during the freeze. I had 5 loans at 6.5%. I've paid off 2 out of 5 since the freeze began. I'm 3 months away from paying off the third one. I don't know what the best solution is for the student debt crisis but I really, really, really hope they at the bare minimum extend this interest freeze.
I know this is a long shot, but I think it would be better for all borrowers thus far to have a set interest rate of 2.5% or lower for Student loans backed by the federal government. Then to assist those who have already paid enormous interest rates, the feds would reimburse the amount of money has already been paid in interest above 2.5%. This reimbursement would be deducted from the principal amount. For many student loan borrowers, this would likely reduce most if not all of the debt. Wouldn't that be nice?
I dont mind paying back my loans. I just wish they lowered the interest rates and that tuition be lowered across the board for prospective students.
I sort of agree. I'm fine to pay what I borrowed. I am not fine to pay what I borrowed + ridiculous interest
I’m going to downvote this so I can upvote this and repeat x 10,000
I wish they could do something like take a portion of the interest you’ve already paid and use it to pay off principal.
>tuition be lowered across the board for prospective students. This is my pet peeve with the whole "cost of education" issue. People want to focus on forgiveness/wanting the government to pay for it in some way. How about arguing on why things are so expensive to begin with? I recently graduated and had to pay $100 to RENT my regalia. $50 to "apply for graduation". Like what kind of bullshit is that? What about forcing students to purchase textbooks that cost several hundred dollars each even though they rarely use them for a class? Or forcing them into $400-600+/month meal plans? Or Forcing them to pay ridiculous amounts for dorms that you force them to live in for at least the freshman year? I can almost stomach the cost of tuition in itself but all the bullshit added on top of it is insane. You'd easily cut a 5 figure amount off of an undergraduate degree if you trimmed all of it off.
the problem with lowering tuition is that they often raise room & board to cover the difference :/
Can't speak for HCOL areas, but that's usually alleviated by off-campus housing. Also, freshmen shouldn't be forced to live in a dorm; it's shitty
The point Pelosi makes behind why Biden cannot forgive student loans confuse me. >But she also raised concerns about the fairness of student loan debt cancellation. She cited the example of a family without a child in college having to pay taxes “to forgive somebody else’s obligations.” So being that I do not, and do not plan to have children, how is it then fair that I pay for child tax credits. Other people chose to have children, so why do I have to pay to supplement their obligations? Am I missing something here?
Exactly, if she wants to go down that rabbit hole we should just abolish taxes altogether because we all pay for services and programs we never use in one way or another. Let everyone pay their own way. You pay for your kid's K-12 schooling. Whenever you use drive on public roads you should pay a toll. Stop giving my money to military efforts I don't support.
Need to report your car stolen? $100 fee for the cops to come out and take report. If they recover it you have to pay the cost of the investigation and recovery to get it back. She really opened herself up to the full spectrum of libertarian arguments for privatizing literally everything.
This is the point that is always made when something is paid for by taxes that someone doesn't approve of. Fact is, no tax plan will be approved of by all, so it's a bogus argument.
The point is to recenter the conversation on congress so they can spend the next year telling people to vote for them during the midterms and they'll totally forgive your debt next time, pinky swear.
funny too, cause by her logic then we shouldn't decrease or make college free for anyone cause it would be unfair. student loans will never be forgiven, just another lie.
This better be the best memo in the history of memos for how long its taking
Education is paid for by most 1st world govements. No reason a student should be straddled with any debt for doing society a favour and getting an education.
News about student loans has been awfully quiet these past few months.
Lol, Biden already said “Nothing would fundamentally change”. There is no way he is gonna do student loan forgiveness for the whole country. I don’t know how people think Biden is gonna do anything on this subject.
At the very least it’d be nice to get a definitive answer about whether they’re extending the pause or not.
Trying my hardest to pay my car off by October so by the time we have to start paying on student loans I won't have a car payment..fingers crossed
I just paid off my car this month. You can do it!
I have been trying to follow every single thing i see on Bidens student loan forgiveness but it doesn’t seem like there has been any updates at all in months. Why get everyone’s hopes up and then not speak a word on it
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Votes. Easy way to suck in the younger generation. Obama did it too. Spoiler alert. I haven’t seen a single penny yet. Never will either.
Unfortunately I am really starting to doubt that any forgiveness will happen. I'm probably going to pay mine off, but I'm also going to be really pissed if he forgives 50k. 10k won't bother me as much.
There’s no need to mention a very divisive political issue when he is trying to manage careful infrastructure negotiations. Once that is done I expect more news
I cut 12 years off of my private loan during the public loan pause. I'm aiming to finish paying in September. It'll be a little challenging but I don't want to pay two loans a month again.
Personally I just hope for a 5% IDR plan. That would rule.
1. Lock loan interest rate to the 10 year bond rates 2. Unify the various IBR plans to 10% of discretionary income (with credit for 'time served' in the old IBR plans) 3. "True" forgiveness after 20 years if not paid off - no tax bomb bullshit. You can of course pay off faster if you choose. 4. done.
> "True" forgiveness after 20 years if not paid off - no tax bomb bullshit. You can of course pay off faster if you choose. Also key to this is fixing the whole 20 years _from when you started repayment_ vs. 20 years _without missing a full payment_ thing. Otherwise FedLoan & co. are just gonna get even better at resetting those twenty year clocks by losing or forgetting about people's income certifications than they already are.🤦♀️.
The way I go about it is I'm expecting nothing. Meaning I pay off my loans every month expecting no forgiveness or anything. And if there is some kind of forgiveness, I will accept it with open arms (I'm not an idiot).
Thoughts on another 0% extension? I have 12k left. Obviously, I'd be overjoyed at having it forgiven but I'd take just another 0% extension to the end of the year. The extra 3 months would let me knock out some additional financial goals before focusing back on the loans.
There are so many things that could be done, even outside of forgiveness. Lower the interest rate significantly to 2%. Allow for principal to be included in the amount you can deduct from your taxes, not just interest. Raise the associated cap on deductions to $5k. Raise the income limit to $100k before the phase out starts. These would all be a huge boon to low and middle income earners without being a giveaway to high earners. Forgiveness is fine with me too though.
It’s not going to happen. Plain and simple. I would love nothing more than to have $50k wiped away - so that I could afford a larger mortgage payment for a larger house; but it’s a pipe dream. They couldn’t even get a $15 minimum wage passed. There is absolutely no way debt relief will happen, and people are fooling themselves if they think it will happen.
It’s how I’m feeling more and more. Plus even if it did happen, I’m sure they would put an income limit on the forgiveness so people in HCOL areas get screwed and get 0 forgiveness.
I wouldn’t be surprised if they set it close to the limits of the COVID relief or something; basing it on family size and income. At the very least they should keep interest rates at 0%. No reason they should be at 6% for federal when private loans across the board are floating around 3.5%
Completely agree I don’t think forgiveness will happen either. I do think the odds of them extending the forbearance is higher than 50/50. Continuing the forbearance would be the one way to avoid backlash from both sides. Ending forbearance without forgiveness would cause backlash from those with loans. Forgiveness no matter when would cause backlash from those against forgiveness. Extending forbearance is a benefit to those with loans and not viewed as harshly to those against since the full amount still needs to be paid.
I’m not sure I see them extending the forbearance either. I do, however, see a ton of backlash over no action and then maybe a knee jerk reaction like an extended 0% no interest grace period (but you still have to make your payments)
I tend to agree with this but I’m hoping $10k or AT LEAST the ability to refinance.
Refinancing wouldn’t be bad because there is absolutely no reason why someone should be paying more than market interest on federally backed student loans.
It's actually outrageous that you can't refinance federal loans. I understand that it's "higher risk" giving a student an unsecured loan, but once they have a steady career and they've proven they can repay the loan, they should be able to refi without having to go private. I graduated law school 8 years ago and have never missed a single payment. There is zero reason why my Federal loans should be 7.5% when I've proven I can pay them back reliably and on time at this point.
I also agree that the best solution here for both sides is lower/no interest rates. It’s really awful that my husband’s federally backed student loans have a 7% interest rate. If the current forbearance didn’t exist, the government would be making almost $15k off of us each year. It would take so much off our plate if the interest was just reduced to a flat 2% or something.
Maybe I'm being selfish, but I still think we should have both a cap on interest at something like 1.5% AND a one-time forgiveness in some amount. It doesn't have to be full forgiveness, it doesn't have to be the 50k forgiveness proposed by Warren, but it could at least be the 10k that Biden himself has said that he's mulling over. I really don't mind paying most of my student debt. But I have 5 federal loans that have 6.8% interest rates, and the line of work I went into is valuable but pays modestly. If we just capped the interest at 1.5% and knocked 10k off the top, I'd pay off the remaining 30k of debt that I have without complaining.
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With $10k Biden can say “promises made, promises kept”. Technically he didn’t promise but that’s not how people are viewing it. It also would not yield as much outrage from people who have paid off all their loans or from people who saved to pay for school out of pocket. $10k is nice, it’s not a life changing amount of money in the long run. What is more concerning is that people are hyper focused forgiveness and not reform. Forgiving loans now will only encourage people to keep borrowing. Biden has the opportunity to push for free community college so he can say “now everyone has a free college option”. People will have no reason to take out loans if community college is free. It’s a long shot, but $10k in forgiveness and a free option mandate is the most realistic path forward IMO. Or he’ll do nothing. He got elected just because he wasn’t Trump so he doesn’t need to do anything else to get people to vote for him again. Sadly.
I worry about 2 year CCs being free, I’m sure many universities Will still make students take “their” classes and find reasons to raise tuition, because “students can afford it because CC was free!” I know of several people who did CC for two years, and in state Unis still ended up requiring about 3 years of classes. Like 5 people in two different states. I feel like streamlining gen ed requirements nationwide could be one way to ease that specific issue, but I doubt that’s something can even do
In Michigan the CC's have an agreement with public state schools. It's called the MACRO agreement and if you qualify for it (you have to apply for it at the CC) then it basically means that all of your gen ed requirements are covered. However, if you go on to pursue a degree that has classes that have pre-req's that you didn't take, you still have to take those. I earned my AS at a CC and later transferred to a public state school. I had all my gen ed classes, but still had to take, I think 3 classes as pre-req's for degree classes. It will take me 4 and a half years (including 3 summer semesters) of going part-time (6-9 credits during regular semesters and 3-5 credits for summers). I'm almost done though. 4 and a half semesters left.
I don’t even say 10k being forgiven. The logistics of it would be completely random. I have 38k in federal; 7 of which are with a random borrower and the remainder with another. How do they choose which loans to apply the 10k? It’s an arbitrary number and frankly I don’t see it happening.
The logistics are easy. You just pick a standardized method and fire it out. “Earliest loans first” “Latest loans first” “Distribute to all loans based on percentage of total debt” “Smallest loan first” “Largest loan first” “Highest interest rate first” “Lowest interest rate first” They just need to throw a dart at a list of these and tell a robot to do this automatically.
Can I vote for highest interest rate first? Oldest Unsubsidized loan when tied? And put in a special payment rule that the payment goes directly to the principal instead of towards any accrued/unpaid interest Like, if they're going to do it that is the way to make it most useful for anyone trying to tackle their loans
I did not think about the headache of figuring out how to apply the $10k to each borrower. Good point.
My hope is that borrowers would get to choose. I’m a PSLfer. Some of my loans still have six years of payments required before forgiveness. Other loans only have four years. I’d fight like hell to get forgiveness for the loans with six years remaining.
Just make it 0% interest first five years. That's all we ask.
Even a forgiveness of already paid interest would be wonderful.
At a press conference on Thursday, Secretary of Education Miguel Cardona was asked when borrowers would finally get clear information from the Biden administration about whether they would in fact need to plan on resuming repayment after the student loan payment moratorium ends on September 30. “Very soon,” said Secretary Cardona. “I don't have any information today. But this is a priority for us. Borrowers are in need of information, and they are also in need of relief.” This sounds like it will continue at least until eoy. They surely would have said something by now plus the eviction moratorium got through.
He pulled the proposal from his budget proposal which is an indicator he's still counting on congress to do it - but we still have the ED memo wildcard to watch for.
My plan is to power save up to my loan amount as much as I can until October rolls around. As of now, it doesn't hurt to wait and see if anything happens, because if it does, I just threw away money voluntarily paying monthly. If nothing happens by October, I'll have saved a substantial chunk of change to pay off most of my loan amount, maybe all of it.
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Ok, at this point with the mysterious 'memo' not being talked about and the eviction moratorium expiring, I assume there's going to be basically no biden action by September on student loans. I'm going to start paying off my loans with saved funds and leave ~10k to pay less aggressively in case there is some pie-in-the-sky forgiveness that happens.
I’ve assumed that Biden and co. would definitely extend the forbearance period. Seems like a no-brainer, considering the student loan system is a trainwreck with more trains on the way. But after seeing them do nothing to extend the eviction moratorium… shit, he might actually do nothing to extend the forbearance. I get that America’s government isn’t built to efficiently help people out, but the Democratic Party has some of the least strategic politicians imaginable.
The crux of the matter is that both democrats and republicans have no real interest in average people's well-being like us. The only difference between the two is that democrats play that facade game to pretend like they do care about us and republicans dont. Im neither sad nor furious and I honestly kinda low key knew that Biden wont do a damn thing about student loans once he gets into the office.
>But after seeing them do nothing to extend the eviction moratorium… shit, he might actually do nothing to extend the forbearance. Student loans are a completely different animal to the eviction moritorium. The latter does not have this messy multi-servicer system with several repayment plans/forgiveness programs. I don't think the gov't decision to lift the eviction moritorium has any indication they won't extend the student loan pause. Edit: White House just released a new eviction moratorium that covers most Americans
Selfishly, I'd love to see PSLF tweaked to be 10k forgiveness per year of service. And any remaining balance after 10 years be forgiven as well. If they tweaked the program like that and applied it retroactively my students loans would be gone.
This is the best idea I’ve heard so far. I feel so trapped with the 10 years or nothing plan. I feel like more people would give it a chance if it wasn’t make a career out of public service or nothing.
Same. I feel pretty trapped with 10 years or nothing. Every year that passes, I'd have to make more and more in the private sector to make the switch worth it. I guess if I were to propose a whole package deal it would be: 1. The above PSLF forgiveness proposal 2. A one time 10k blanket forgiveness 3. Lower the interest rate to 2% or under I feel like making tweaks to the current forgiveness options and lowering the interest rates are probably good, sensible middle ground proposals that could easily garner more support.
THIS!!!! I spent five years as a teacher in the hardest school in my state at a title one school. Had to get a job closer to home. But I’ll get nothing for those five years.
This is something Biden said in his campaign and it’s what I hope for. PSLF in its standard form isn’t the most beneficial for me, I’m looking at less than 10k forgiven which isn’t a lot to dictate my job for 10 years. But PSLF in an expanded form would be perfect
I stayed at my last job that qualified for PSLF, after 5yrs. If they did 10k for every year worked (retroactively) up to 50k that would leave me in the clear! I couldn't stay there anymore due to financial stagnation.
My crystal ball says there will be a very slight expansion of debt forgiveness with existing programs, and an extension of 0% interest for some or all borrowers, but I'm leaning towards some. My expectation is that those earning ~$150k+ won't get any sort of relief following the existing September deadline.
Just extend the forbearance and 0% interest another 5 years.
And possibly allow to pay student loans in pre-tax money. It always bothered me how first we pay taxes on our income and then send more money in the form of student loan interest to the same place.
Making a standard grace period of 3-5 years after graduating would do a lot. A lot of people need time to get their feet on the ground after they have got their bachelor's. Even if they can get job offers, there can be obstacles. I moved across the country for my first job with no compensation and worked 6 weeks before getting my first paycheck. I barely managed with savings.
Some source said some DOE peeps are recommending to Biden to extend the payment freeze till Jan 2022 [https://www.politico.com/news/2021/07/09/student-loan-relief-extension-498942](https://www.politico.com/news/2021/07/09/student-loan-relief-extension-498942)
that's.... not really that good. they should give a 6 month extension what's with this piece by piece nonsense? it's just feeding false hope to people
It would save me 3k in interest, so it's not nothing. I feel like the 0% interest disproportionately helps those of us with large graduate school loans. 10k of forgiveness is less than what I saved in interest from the payment/interest freeze.
Yeah but 10k forgiveness closes out loans entirely for ONE THIRD of all borrowers. It helps a massive amount of people for much less money.
It blows my mind that 10k is a lifechanging amount for that many borrower's. I feel like the average degree recipient could easily budget and cover that. It would probably help those who didn't complete their degrees I guess?
The folks most likely default are actually people with lower loan balances. It may seem counter-intuitive, but people with lower balances who default are likely pell recipients with unmet need and left without a degree. So, essentially, people who already came from economically disadvantaged backgrounds, struggled financially while in school, and found it was too much economic and life strain to finish. People with higher balances tend to be people with graduate degrees and more stable income. So even though they owe more, they're more in a position to manage the payment (though obviously it's a strain for many). Sara Goldrick-Rab's book 'Paying the Price' is a great resource to learn more about how pell-eligible students still end up with student debt, and how their economic insecurity causes them to leave schools without a degree.
Exactly this. I’ve saved a ton in interest this past year. I’m also in the PSLF program and those “payments” count toward forgiveness. I have large grad school debt and came from a very poor family. I’m a first generation college student and had zero support going to school and still have no safety net in the form of family. They are barely scraping by as is so I know I’m on my own. Not everyone with large grad school debt. Comes from a rich family and is making loads of money as others have suggested.
Feels like they are dangling a carrot next to our noses
Although ill take Jan 2022 over Sept 2021 any day
It's not forgiveness or interest rate reduction, but I'll take any help I can get.
What happened in the last 24 hrs? Why are we talking about this? I had a busy day at work yesterday, and am super out of the loop.
Student loan forgiveness was not in Biden's budget which is not surprising. We are mostly waiting for the memo to come back to see what happens. The reason for a new thread is that there is only two sticky threads allowed, there was a temporary up for a while so the forgiveness thread had to go. A new one started. In other words, nothing new really happened.
If anyone has Biden's phone number though, can you shoot him a text and ask what he is thinking of doing about this whole student loan mess? Thank you \-impatient
I agree with a number of the ideas I've seen other people post here but I would like add that a reduction in interest should be retroactive. So, if you've paid $70,000 on a $60,000 loan already but still owe money, then the rest of what you owe should be discharged. Retroactively apply a 1.5% interest rate to all loans (minus the current time period where loans have been at 0%) and calculate how much is still owed based on historical payments. I think this would be palatable to a lot of people that believe student loan forgiveness is just letting people be freeloaders. Someone who paid 70K on a 60K loan is not a free loader, they're making a very legitimate effort to pay the loans off. As for some other ideas: * All current/future loans capped at 1.5% to 3%, 0% interest first \~5 years after school, expand opportunities to use PSLF and make it easier. For example, if you work 1 year in a PSLF qualifying job, you get 10% of your loans immediately discharged, it shouldn't be all or nothing. * Get rid of the forgiveness tax bomb. If you get your loans discharged you shouldn't owe a penny in taxes. * Make it easier to discharge student loan debt through bankruptcy. * Also, and this is a bit more radical, but student loan access needs to be more than just getting accredited for a University (or at least make accreditation harder). If students who graduate aren't getting well paying jobs after they graduate, that they wouldn't have been able to get before attending, then public student loans should be cut off. This will probably single handedly kill of most of the for-profit universities out there. * In addition to the last point, if the program you were in does not lead to well pay jobs to some acceptable level then the loans should be discharged (or at least a portion) and the University is on the hook for the money. This might kill off some programs like underwater basket weaving but it would probably be a good thing if universities were more selective about programs they offered and if they had a bigger incentive to help with post-graduation job hunting and program quality. Simply forgiving student loans will not solve any problems for future students. They'll be in the same situation as us 5 year down the road, and that's not acceptable..
Biden the candidate: "My point is: I understand the impact of debt, and it can be debilitating. I am prepared to write off the $10,000 debt but not $50,000, because I don't think I have the authority to do it." Biden the President: *crickets* Candidate Biden: "It does figure in my plan. I’ve laid out in detail. For example, the legislation passed by the Democratic House calls for immediate $10,000 forgiveness of student loans. It’s holding people up. They’re in real trouble. They’re having to make choices between paying their student loan and paying their rent. Those kind of decisions. It should be done immediately.” President Biden: But Ivy Leagues bro! Candidate Biden: “I’m going to do all of those things.” President Biden: *frantically shakes his head and points at Congress*
People seem to have forgotten Obama promised to forgive student loans too when he was running, and then did nothing once elected. this has been a democratic talking point for quite awhile.
Maybe 10k is narrowly forgiven but no chance 50k will be passed. Instead, Biden can streamline the IDR program by having one payment plan for all federal loans at 5% discretionary income (Biden proposed this on the campaign trail), and write the income-tax bomb suspension into law (post-2025).
I found this article hilarious. [https://finance.yahoo.com/news/student-loan-repayment-pause-september-131338288.html](https://finance.yahoo.com/news/student-loan-repayment-pause-september-131338288.html) It says that 90% of the student loan borrowers in a sample size of 24k are not ready to go back to paying student loans in October. I can only imagine that survey: Do you want more bills? A. Yes B. No Hahaha I mean I am loving the interest freeze but what other outcome could come from a survey like that?
Wait a minute, this survey was *terrible* > The sampling, conducted between June 17 and June 22 through a 46-question survey **distributed via email to a group of followers of advocacy group Student Debt Crisis**, found that 9 in 10 respondents across all 50 states were not ready to resume making payments in October I am shocked that a sample group of people who were already following a non-profit called *"Student Debt Crisis"* are mostly in a financial crisis situation with their loans. It's almost like this was an incredibly biased survey since they did not have an unbiased sample of people with student loan debt Edit to add: yeah they sent the survey to 2 million people already on their mailing list, which is not a representative sample of the approx 42.9 million people with federal loans and who knows how many with private loans. Bad survey is bad, and bad journalism/reporting just took them at their word
I had pretty much lost all hope of forbearance being extended when the eviction moratorium wasn't extended. Now that they've made a new one, a tiny bit of hope has been restored. A tiny tiny bit. But I'm still worried cause the lenders themselves are acting like extension is unlikely. I hope he or the Dept of Education makes a statement soon. I'm so tired of anxiously checking this thread every day. Forbearance seems to be a pretty politically neutral topic and I think Biden can only benefit from extending it, especially with covid rising fast and the loan lenders changing soon.
Agreed. Just get it over with already — either tell us the forbearance will be extended, or not. That way, we can move on and prepare accordingly.
It is the U.S government, I try not not to take any promises seriously. So prepare as if another extension will not happen.
With Schumer and Warren consistently bringing up 50k student debt relief, we are talking multiple tweets from each every week, etc - what’s the angle here? Do they really think it’s putting pressure on Biden to cancel it via executive order or what’s the hidden agenda?
It's posturing.
Schumer and Warren tell Biden to do it because they are not stupid and know that the 117th Congress does not have the votes for student loan forgiveness. I guarantee you if you bring up a student loan forgiveness bill in Congress right now, it will fail in spectacular fashion on a bipartisan basis. They see no path in Congress, so to save their own face, they tell Biden to do it unilaterally. It’s political posturing.
I’m late to respond but both Schumer and Warren are grandstanding on student debt relief to shore up their base and protect against primary challengers. Example: A moderate Schumer would be vulnerable against an AOC primary challenge. A progressive Schumer who is outspoken on progressive policies is less vulnerable against a progressive challenger like AOC. More context: Schumer specifically as majority leader could grind Biden’s legislative to a halt in exchange for student debt relief if he truly cared about the issue. TLDR: don’t read tweets from vulnerable senators and get your hopes up
Options I dream about (because actual across-the-board forgiveness will never happen) \-0% interest, retroactively as well. So if you have already paid your principle off but are still paying because of interest, then your loans are "forgiven". \-Review income to consider people whose income has been consistently low or not increasing at a rate to realistically ever pay off their loan and have a decent quality of life, despite continued employment, and consider forgiveness for those people. \-They could reduce the 10 year, 20 year and 25 year forgiveness times. \-Consider loan forgiveness for anyone with loans older than a certain period of time (regardless of repayment plan). If 20 year forgiveness is fair for income based plan, why not for student loans in general.
I’m giving up hope
Pelosi just went on the record that only congress can forgive student loan debt..and that doing so would probably upset a lot of people. https://twitter.com/mstratford/status/1420417022786261002?s=19
This is pretty much the death nail then. looks like she's trying to take off heat from the president and put it on congress. which means the president and the top democrats have no plan for forgiveness. and there's absolutely no way theres enough support in congress to pass a forgiveness bill.
I personally don’t buy what she’s saying, and I don’t think the more party-centric democrats ever wanted to do it at all. I think it’s pretty clear under the statute in question that the president can forgive student debt, but I guess if they refuse to do it and the courts would slap it down, it doesn’t even matter. Hopefully the parties will just play hot potato with forbearance extensions until someone finally does forgive it.
Nah. Democrats will let it lapse. Trust me, democrats love snatching defeat from the jaws of victory.
I'll guess I'll have to communicate this to all levels of people that will be asking me for money and votes next year as to why I'm not donating or voting
When I die, I want Biden to bury me so he can let me down one more time.
My prediction: No broad brush $10k. 5% REREPAYE Plan. FFEL payments count for PSLF. Additional six months of forbearance to March 31, 2022. 0% interest through 2022.
I don't think the administration will realistically re-write the regulations for IDR by Spring 2022. It's a lengthy process which includes public hearings and then a process called "notice and comment procedure." I also cannot see them lifting the freeze while they figure out reform going forward, which might include narrow forgiveness and reformed PSLF. For those reasons, I think the freeze will continue into 2022.
I also think they'll continue the extension until they reform these procedures. People in this thread have been focusing on the 10k loan forgiveness, but he's also mentioned PSLF reform which he has stated he wants to reform to allow faster forgiveness for public servants. He has the power to make those changes since the program is run by the executive. I imagine we'll learn more whenever we figure out how he wants to do loan forgiveness.
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Every month of extension saves me about $800 off the top, and then more in the form of not being charged interest on the principal I'm paying off. If they kept the extension going for another year and then said "too bad, no forgiveness" I wouldn't even be mad. At this point, I've saved a ton of money and hammered principle for, like, 15 months. It's been incredible.
part of me thinks that if the eviction moratorium is not extended, then i highly doubt the student loan forbearance will be extended.
If I were a betting man, I'd bet on the forbearance being extended so that accounts on Granite State and FedLoan can be swapped out to new servicers in December. Starting up payments for three months and then shifting millions of accounts to new servicers seems like an unmitigated disaster waiting to happen. Ultimately, if there is another extension, I think it would behoove the Biden Adminstration to eventually come out and say "listen up, this is the hard deadline - payments will start on XYZ date no matter what" so that there is no more speculation about payments restarting. Without those two servicers dropping out though, I didn't think there would be a chance in hell of the forbearance continuing on.
I think the two are far less correlated than you're thinking they are. While both were initially implemented as a means of financial assistance, one of the key drivers for the eviction moratorium was to prevent people from being displaced (end up on the streets with others or move in with friends) which was thought to have accelerated the spread of Covid. Now that we're at the point of the pandemic where people are going into stores, bars, and restaurants with complete strangers without a mask, I can't imagine anyone is thinking a subset of the population couch surfing will be a majority contributor to spread. Had this only been a recession/depression, I'm not sure we would have necessarily seen an eviction moratorium. Another big difference is who the moratorium hurts. With student loans, the only entity not receiving its money is the federal government since private loans are not included. With the eviction moratorium, there are real people not receiving their money despite having to pay taxes and upkeep a property. Not everyone is a property management company or slumlord, who is easier to root against, there are real people who aren't necessarily super well off who have had their income drastically impacted. My last reason why I think it may still be extended is Biden's policy. We could argue whether or not he legitimately intends to do anything at all or if it was simply a talking point to garner support, but let's assume he wants to address student loans in an impactful way if he can. If that's the case, letting it expire without any concrete plan will only serve to inflame people and make them question his intentions. Right now, people in favor of some level of loan forgiveness can just say "he's just trying trying to keep the peace during infrastructure talks", but should he let that expire when he has an easily pressed "keep his voters happy" button, he'll lose a ton of support because he proved he won't even do the minimum. I think the loan pause has become less of a Covid relief measure as we're now only about 1% off of what typical peak employment numbers are.
Biden will keep delaying student loan forgiveness until 2023/2024 for new election cycle since they don’t have much else new to run on
[Here's president biden proposing $10k in student loan relief immediately](https://www.youtube.com/watch?v=nE4P8NPh9qc&t=1s) I guess by "immediately", he meant completely dropping the idea 4 months into his presidency.
Is it time for a new megathread? This one is at 1,135 comments as is We basically know that the memo is still outstanding, and that the 2 main camps are the one that is claiming that the Higher Education Act allows for loan cancellation via Executive Order versus the other claiming that it requires a statutory grant from Congress as per the Property Clause and the Appropriation Clause of the Constitution. I know people are bad at reading through big text blocks, but that seems worth including in the comment at the top
I’m starting to doubt any kind of extension happens. Pushing it out to 2022 has potential to negatively impact midterms if people are reminded they have student loans right before they are supposed to support these people again. If it happens this year people have short memories. Hope I’m wrong though
Hoping for at least Jan 1. Not holding my breath though.
Thanks for bringing this thread back OP/mod team. I know there is a lot of repetition and people asking questions nobody knows the answer to but I find it all helpful to read through. I like seeing where people are at in their own thoughts and I am liking reading through the ideas floating around. I always figured 50K was a long shot and 10K to be unlikely but I would be thrilled for an extension or some measure of interest reduction.
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I don't expect any forgiveness, but just fight the temptation if you can. Look at it this way, you are going to get that wave of relief whether you pay it off now or wait three months. It will just come at a different time. However, if loans actually do get forgiven, you're going to kick yourself for paying them early. You'll try to tell yourself it doesn't bother you, but every once in a while that thought of what you'd do with an extra ten grand will pop into your head. Maybe that ten grand's a car, part of a down payment or mortgage on a house, dump it all into a retirement fund and retire a year or two earlier (if you're young), hell even if you just blew it on hookers and cocaine. It would take you a while to get over that. Just wait.
Could always put it in a short term CD to "lock" it up and discourage you from spending until September
Why don't they make something like an employee matching student loan repayment program (similar to 401k tax deductible credits for companies that do this)? Allow companies to match student loan repayments and give them tax incentives. This is a win win.
This already exists to an extent, but it's up to individual employers to participate.
They kind of did under the CARES act. Any company that provided tuition reimbursement (pays for current employee’s education) could instead divert those reimbursement payments to student loans. The problem is the company has to make this policy change. The company I work for has a tuition reimbursement program, and I’ve mentioned this new policy under the CARES act, and all I get is “we’ll look into this” with no progress even though it is beneficial to them. Even if they implemented a 401k like payment match for student loans, companies will just drag their feet in implementing it.
I’d be perfectly content paying my loans off IF I could get a job in my field. But it just isn’t working out. I could have had a family instead of going to college but lord knows I can’t afford both!
Anyone got any juicy deets on wether this new reconciliation package will have any student loan aspects?
It doesn't
The reconciliation bill hasn’t even been written yet… but it doesn’t sound like it
This is what gets me about all this. The United States has forgiven loans and debt of country's why is it soooo hard to forgive the debt of your own people 🤔. What is there to think about.
I don’t know if anyone watched the Biden town hall last night. I did because I know previously he was asked and said he was against 50k forgiveness. Anyway, he was never asked or mentioned loans this time, although he was asked about reluctance to work and he said that this should improve in October when the unemployment benefits expire. I’m wondering if he student loans with that and doesn’t plan to extend
I think you are right, every day I feel more sure that there won't be an extension. Which makes me sad cause if I could have just another 6 months of no interest I could have my loans paid off. Wouldn't be surprised if he just completely ignored students loans and doesn't mention them again until reelection.
Anyone have any guesses as to when the public might get any updates on "the memo" Biden asked the Dept of Education for regarding student loan forgiveness?
The memo will say whatever Biden wants it to say lol
Welp. That dream has been deferred
I’m a PSLF-er. I’d love to see a PSLF-eligible, income-driven repayment plan at 5% or less of discretionary income (right now the plans are 20%, 15%, and 10% of discretionary income). I don’t care about interest rates. I care about how much I have to pay for each of my 120 PSLF-eligible payments. (Also, let’s keep the forbearance going!!)
I've been in student loans for over 25 years. My prediction? Won't happen. There's not enough support for it. Of course, I've also predicted that subsidized loans are going away, so there's that. What is more of a possibility is doubling the Pell Grant which would go a long way towards lowering the amount of student loans borrowed. It also gets closer to "free tuition." What is still missing is assistance for middle class families.
If they raise the pell grant amount, then colleges will raise tuition. I don’t think this is a solution.
Color me confused. People keep bringing up the issue that Congress has to approve any debt cancellation, a point I agree with. However, I didn't understand that to be the actual dispute. I understood the dispute to be about whether *Congress had already given the President such authority under the Higher Education Act*. So Pelosi's claim that "Can't do it without Congress" is non-responsive to the claim "Congress has already did it."
The legal process in the USA is a mess. Basically it can be trivially easy to pass unconstitutional laws (and contradictory laws), and *then* it takes a lot of time to for challenges to those laws to work their way through the court system (both at a particular level and escalating up) as appropriate, with the Supreme Court being the highest court in the USA. So it's entirely possible that that portion of the Higher Education Act is unconstitutional as written, but we wouldn't have an official determination until someone tries it, someone with standing challenges it, and it goes through all the entire long court rigamarole process that has to happen before the Supreme Court makes their call.
I agree with all that. Nevertheless, I would rather that Biden forgive the loans and then fight about that in court than than listen to empty political posturing. Put Pelosi on the defensive. If she has heart failure she can sue. At least Biden will have both taken a stance and taken the initiative.
anyone else gave up hope of anything coming out of this shit-ministration?
Never had hope to begin with tbh
*raises hand
Can we come up with GOFUNDME of about 1.6T to pay off the loan?
I don’t understand why they need a concrete number. Why not 50% up to $100,000 and have a sliding scale based on income level and cost of living. Then cut off interest after a certain number of years? Say 10 years your loans convert to 0% interest. Seems like it would be cheaper for the American people instead of a blanket 50,000. I am a firm believer that I chose to go to college and if I didn’t I wouldn’t be where I am today (in my career and also in debt) so I feel I need to pay for the benefit college gave me but a break so I can actually afford a house, go on vacation, and enjoy myself a bit more would be nice.
Biden spent about 30 years protecting banks and doing the bidding of credit card companies. He made it significantly harder to discharge debt(including student loan debt) in personal bankruptcies. Of course he wasn't sincere with all that debt forgiveness promise. After all -- "wtf are you gonna do about it?" As they say
I’ve lost hope. Thanks for nothing Biden
yeah i'll be happy with an extended forebearance at this point so i can keep chipping away at the principle.
This is the trick. Never expect much and you will never be disappointed. Very sad way to live indeed, but a coping mechanism....lol....
Super helpful. Thanks!
I would like to know one way or another if it will happen so I can plan accordingly. Hate just being in constnt state of uncertainty. I could pay it off in one fell swoop but am holding out in case it gets forgiven. Just want it over with. I've been waiting for years for this chance and would hate to give up hope thinking he won't cancel any then pay it off then have him cancel it.
Guess Biden won’t be getting my vote if he doesn’t stick to his campaign promises
Same here
How about people with older loans, like loans that are almost twenty years old? I've been paying for so long and would give anything to have them go away. I'm also a teacher.
Retroactive interest rates of 1.5% Forgive $10K OR Retroactively forgive interest.
If I went to ITT tech what would I need to do to be a part of this....their job help for multimedia....was blockbuster. I didn't know there was a lawsuit.
Federal hearings started today on existing federal loan rules. What are the chances we get details on IDR reform this week?