The administration of President Joe Biden has announced that the pause on federal student loan repayments will be extended until August 31. The student loan freeze is beneficial but not sufficient for those struggling to get their payments on time due to the economic disruption. exacerbated by the COVID-19 pandemic.
This will be the seventh delay since the start of the pandemic, which is very beneficial for tens of millions of borrowers who were due to make payments again by May 1.
On 35 million students have been unable to make payments, meaning that if the break were to expire next month, accrued interest and mounting debt would be inevitable.
Many debt forgiveness advocates have come forward to demonstrate how forgiveness would not only relieve a significant amount of student stress, but would also be rewarding.
An economic policy that eliminates debt would help both students and the economy. According to the researchers, this would increase GDP, add more 1.5 million create new jobs and reduce the unemployment rate.
Borrowers can use this money by buying property, spending in their communities, and investing in the things they need.
“Americans owe $1.6 trillion on federal student loans — more than they owe on car loans, credit cards, or any consumer debt other than mortgages,” The New York Times reported.
Some have suggested that government officials compromise by reducing each borrower’s debt to a certain amount.
For example, Senator Chuck Schumer called on Biden to remove $50,000 per person.
However, Biden has refused to do so and believes debt cancellation should happen through legislation, which would be up to Congress.
If so, students will not see a change any time soon as it is extremely difficult to get such a proposal through the legislature.
“Congress supporters say they don’t have the voices; a plan to cancel $10,000 in debt for many borrowers passed the Chamber in 2020 as part of his pandemic relief program and then died in the Senate,” according to The New York Times.
After the four-month hiatus and in the build-up to the midterm elections, this will be an ongoing issue for many.
“With each repayment extension, you make the case for its cancellation more,” Wisdom Cole, National Director of Youth and Colleges of the NAACP, mentioned. “At this point, cancel it.”
It has become apparent that with each delay there is a visible push towards complete debt elimination.
The Ministry of Education is trying to make sure people are helped in these unprecedented times.
“If federal student loan borrowers can no longer afford their monthly payment once they resume, they may be eligible for an income-based repayment plan. Under these plans, which are based on income and family size, a monthly payment can be as low as $0 per month. CNN reported.
While this may be life changing for some families, for other families their income may be just above a specific threshold that would not qualify them for such benefits.
Canceling student debt would change people’s lives by easing a burden that seemed like an endless problem for those who just want a decent education.
“Is this ruining lives and holding people back,” Senator Patty Murray mentioned as reported by the Associated Press. “Borrowers are grappling with rising costs, struggling to recover on their own from public health and economic crises, and grappling with a broken student loan system – and all of this is particularly felt by colored borrowers.”
Students go to college to explore their interests, learn, grow, and create a future where they can live happily. However, accumulating interest and paying off debt for the rest of their lives robs them of achieving these goals.
While it is helpful for the Biden administration to help students by ending their student debt, extra effort should be made to ensure the well-being of every learner.