Student loan debt: $ 9 billion canceled by the Biden administration
Millions of Americans are struggling with student loan debt. The VERIFY team responded to questions about what actions the Biden administration is taking to address the issue.
The New York Federal Reserve’s most recent calculation of total student debt outstanding is $ 1.57 trillion, affecting millions of Americans.
Because it is an issue that affects so many people, the VERIFY team answered two questions regarding student debt as part of the âVERIFY Weeklyâ column of the week. You can watch the full video on our YouTube page here.
Did the Biden administration write off over $ 9 billion in student loan debt?
Yes, the Biden administration has written off over $ 9 billion in student loan debt. Cancellations concern small groups of borrowers and represent less than 1% of total student loan debt.
WHAT WE FOUND
Earlier in 2021, some progressive lawmakers called on President Joe Biden to write off up to $ 50,000 in student loan debt for each borrower. The president did not make such a move, but in August headlines indicated that the Biden administration had written off more than $ 9 billion in student loan debt since January. This led to a viral tweet who asked the question “For whom?” “
Here’s a breakdown of those who have had their student loans canceled.
In March and August, two separate moves of the Department of Education released a combined student debt of $ 7.1 billion for an estimated 450,000 people with “total and permanent” disabilities.
Later in August, the Department of Education paid off $ 1.1 billion in student debt for 115,000 former students of the ITT Technical Institute (ITT) over issues that led to the school’s closure. That’s $ 8.2 billion between the last three announcements.
The move was part of the pre-existing borrower defense program, which grants borrowers aggrieved by institutional misconduct relief on their federal student loans. The Education Department streamlined the program in March to provide more debt relief to eligible borrowers.
Between the additional relief provided by the borrower’s defense line and other dumps this year, the education ministry said it has offloaded $ 9.5 billion in loans to 563,000 people since January. This represents about 0.61% of student debt nationwide, according to the New York Federal Reserve’s calculation of outstanding student debt.
Has President Biden pledged to write off student loan debt?
Yes, Biden previously pledged to write off at least $ 10,000 in federal student loan debt for each borrower.
WHAT WE FOUND
When Biden ran for president, he said his jobs and economic recovery agenda would focus on student debt relief.
On his campaign website, he said he would “include in the COVID-19 response an immediate cancellation of a minimum of $ 10,000 of federal student loan debt” and “forgive all federal debts related to fees. Two- and four-year undergraduate tuition at public colleges and universities and private HBCUs and MSIs for debt holders earning up to $ 125,000.
At a press conference on Nov. 16, 2020, then-president-elect Biden again signaled his support for an immediate $ 10,000 per borrower remission of federal student loans.
There are differences as to who exactly has the authority to initiate a loan forgiveness and how much that might be possible. Some members of Congress, including Democratic Senator Elizabeth Warren, say it is Biden’s responsibility.
In March 2021, White House press secretary Jen Psaki said it was Congress that could write off $ 10,000 in federal student loan debt for every borrower.
âThe president continues to call on Congress to write off $ 10,000 in debt for student loan borrowers,â Psaki said. “This is something that Congress could take action on, and he would be happy to sign on.”
In February 2021, Psaki tweeted that the administration “examined whether there were any measures [Biden] can take through executive action.
Currently, Biden has yet to propose specific executive action.
More from VERIFY: No, FedLoan and Granite State borrowers don’t have to do anything to have their student loans transferred to a new service agent.