President Joe Biden announced Wednesday (Aug. 24) he will forgive $10,000 in federal student loan debt for most borrowers.
In a tweet, Biden said he’ll also cancel up to $20,000 for recipients of Pell Grants. The relief will be limited to Americans earning under $125,000 per year, or $250,000 for married couples or heads of households.
The Education Department notes that the relief is capped at the amount of a borrower’s outstanding eligible debt.
Along with the debt forgiveness, the president will also extend the payment pause on most federal student loans “one final time” through December 31, 2022, according to the tweet.
According to CNBC, higher education expert Mark Kantrowitz estimates at least 9 million borrowers could have their balances entirely cleared by Biden’s plan. The program will cost the federal government around $244 billion along with $120 billion for Pell Grant forgiveness, Kantrowitz notes.
The move comes after years of advocacy pressure, which was increased due to the COVID-19 pandemic. It also fulfills a campaign promise Biden made while running for the White House as the midterm elections approach.
The discussions also centered around how student loan forgiveness could impact the high inflation costing Americans heavily.
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