President of The United States Joe Biden had rolled out his plan back in August 2022 to forgive as much as $20,000 in education debt for millions of his fellow Americans. The Biden School Loan Forgiveness Plan is an initiative taken by Biden and his administration which would have offered up to $20,000 in federal student loan forgiveness.
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This loan forgiveness plan also included a new proposal for an income-driven repayment plan. However, Biden’s administration is facing major setbacks from the U.S. Supreme Court due to several reasons.Â
As of now, Biden’s administration is currently not able to offer the student loan forgiveness plan. Millions of borrowers in the United States would have to soon resume making their monthly student loan repayments that will be beginning in October. However, there has been news about the current situation because President Biden is looking for a new path to make this plan come into effect as soon as possible.Â
Who Is Eligible For Biden School Loan Forgiveness?
President Joe Biden’s loan forgiveness plan may benefit and be the reason for some relief for millions of American students but there are certain eligibility criteria to avail the loan forgiveness plan.
The application process for availing this loan forgiveness plan has been currently halted due to the plan’s complication with the U.S. Supreme Court. Once the plan gets approved by the Supreme Court it is then eligible Americans can apply for the school loan forgiveness scheme. Let us have a look at the eligibility criteria for availing the student loan forgiveness scheme.Â
- To be eligible for the forgiveness scheme, one must have federal student loans and have an annual earning less than $125,000 or $250,000 per household. Borrowers who are able to meet the criteria can avail a benefit up to $10,000 in debt cancellation.
- Students/candidates who have received Pell Grant during their education can qualify for the $20,000 forgiveness.
- Anyone who is still paying back a student loan owned by the federal government and disbursed before July 1, 2022, as long as their personal income is below $125,000.
So far, the above are the only eligibility criteria that has been set up by Joe Biden’s administration. If you are still unsure whether you qualify or not then you can use the student loan forgiveness calculator. To calculate, you can visit reliable websites and check your eligibility.
How Much Student Loan Debt Could Be Forgiven?
The loan debt amount that could be forgiven depends on whether or not the borrower has received a Pell Grant. In case you haven’t applied for a Pell Grant you can start by submitting a FAFSA form. This form needs to be filled out every year you’re in school and demonstrate your financial need to stay eligible for federal student aid.
Those who have got the Pell Grant could receive up to $20,000 in debt cancellation. On the other hand, other borrowers who are able to meet the income threshold requirements will be receiving $10,000 in debt cancellation.Â
If your student loan balance is less than that of the amount you qualify for, your relief is capped at the amount of your outstanding debt. For instance, if you are eligible for $10,000 in relief but you have a $8,000 balance, then you will receive $8,000 in relief.
Timeline Of Events On The Latest Controversy
A lot of controversial events have taken place since the announcement of the student loan debt forgiveness plan back in Aug 2022. The load was not suitable and did not apply for private student loan borrowers. Let us have a look at those events in a timeline manner so that you get an idea about the latest controversy that is currently ongoing about the student loan debt forgiveness plan.
- It was on Sep 29th, 2022 six states reportedly sued President Joe Biden. The six states included Nebraska, Missouri, Arkansas, Iowa, Kansas and South Carolina.Â
- A day later on Sep 30th, the Arizona attorney general sued Biden claiming that the plan would harm Arizona by making it harder for the state to recruit workers because the PSLF program would be undermined by the plan that Biden announced.
- On October 4th Wisconsin Group sued President Joe Biden.
- On October 7th Wisconsin Group appealed the judge’s dismissal saying that the court didn’t have any jurisdiction.
- October 17th was the day when Biden’s student loan forgiveness application opened despite the rising legal concerns and challenges.
- It was on October 20th when US District Judge Henry Edward dismissed six states’ lawsuit against Biden concluding that it lacked standing.
- Many appeals were made in October 2022 to temporarily block the student loan forgiveness plan.
- It was on Nov 4th 2022 when the Supreme Court of the US denied the request to block the plan.
- On Nov 10th the plan was blocked and Biden’s administration filed an appeal.
- The next day that is on Nov 11 the Department of Education stops accepting student loan forgiveness applications.
- On Nov 18th Biden’s administration asked the Supreme Court to lift all blocks against the program.
- It was on Nov 22 when the pause of the plan was extended to June 2023.
- It was on Dec 1st when the Supreme Court agreed to hear the arguments against Biden’s plan.
History Of Biden School Forgiveness
The school loan debt forgiveness plan rolled by Biden and his administration last year in August has seen a lot of ups and downs. This plan received both criticism and support from people of the United States and has been in the news for being legally challenged. Let us have a look at what Biden and his administration has done in the past year to make this plan a success.
What Has Biden Done So Far To Forgive Student Loan Debt?
Biden was the one who announced the plan last year in August 2022. Now, we know that the scheme is facing a lot of legal challenges. The administration of Joe Biden is working continuously to come out with new plans to make their plan successful. The White House is saying that the Education Department will now try to use the Higher Education Act to deliver on student loan forgiveness.Â
The legislation was signed by President Lyndon B. Johnson back in the year 1965, which allows the secretary of Education some authority to release or waive off borrower’s education debt. The President of the United States has been under pressure ever since he pitched the student loan relief while running for the presidency.Â
Biden wanted to carry out their plan with the Heroes Act because it specifically addresses national emergencies but they have used the Higher Education Act as Biden’s legal justification. It is only because the Heroes Act is an emergency-time measure, it wouldn’t require the lengthy rulemaking process that the Higher Education Act does. Biden has always hoped to cancel people’s debt and thus promising some relief.
What Are The Different Proposals For Biden School Loan Forgiveness?
Biden and his administration wanted to move forward with their plan by using the Heroes Act as a form of legal support and justification. It was Senate Majority Leader Chuck Schumer who had called on the President to use the Higher Education Act as his legal justification.
Currently, Biden and his administration are facing legal challenges which is why the Education Department is currently not accepting any applications for the loan forgiveness scheme.Â
Arguments For and Against Biden School Loan Forgiveness
Many Americans who belong to the middle-class and lower middle-class category have felt that the plan would be suitable for their children’s education loan payoff. They felt it would also be a great relief for them which is why they have shown their support.
On the other hand, this new plan was felt not at all suitable because of several reasons. Some reasons have been already mentioned above. Let us see arguments for and against Biden for school loan forgiveness.Â
Arguments In Favor Of Biden School Loan Forgiveness
Surveys have been conducted where it has been witnessed that majority but not overwhelming support has been in the favor of Biden’s school loan forgiveness. Biden’s administration is currently facing legal issues in the Supreme Court.
Biden and his administration is working on a new plan to make their scheme a success so that it is a win-win situation for all. Joe Biden does not want the Supreme Court to get the final word on student loan forgiveness and wants to keep trying harder.Â
Arguments Against Biden School Loan Forgiveness
Arguments against Biden for the school loan forgiveness program have been in numerous numbers. The funding is expected to be more than 400 billion dollars which is one of the biggest in history. Many organizations and even normal citizens feel that there is no need to pass such programs. Some of the arguments made against Biden have been mentioned above in the timeline.
Conclusion
The future of Biden School Loan Forgiveness seems quite unstable as of now. But, it all depends on how things turn out by the decision made by the Supreme Court. Proper arguments need to be made so that the plan becomes a success. Advocates will be taking new steps to make the plan successful. President Joe Biden has even confirmed the same saying that ‘This fight is not over’.
