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President-Elect Joe Biden expected to roll out student loan forgiveness plan
President Joe Biden expected to call for $10,000 in student loan forgiveness for borrowers.
HOUSTON - On his first day in office, President-elect Biden is expected to call for $10,000 in federal student loan forgiveness for borrowers and continue the pause on federal student loan payments.
Those moves and other proposals could be a huge relief to 3.6 million Texans. Student Loan Hero says they have an average of $31,000 in student loan debt.
"I don't want to drop out of school, so, ok let me go in, I'll pull loans out in my name," said Kaitlyn Allen.
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The Texas Southern University student says she's taking on debt to pay tuition and will one day join the ranks of millions who have to make payments on it.
"Student loans, they do come with interest. It's not like I'm pulling $2,500 out and that's it. It's never going to be, 'That's it.' It's only going to continue growing interest," Allen dreads.
As the pause on federal student loan payments expires on January 31, President-Elect Biden plans to continue it, but for how long is unclear.
It's a good idea to University of Houston-Clear Lake management professor Dr. Troy Voelker.
"Right now, you've got a lot of people struggling and a big part of that, for recent college graduates, is their student loan debt. That moratorium on payments is helping them stay afloat," said Voelker.
Federal data shows Biden's call to cancel $10,000 in federal student loan debt per borrower would pay it off for 15 million borrowers, and cut costs for 28 million more.
"It's going to allow people to have lower monthly loan payments. That's going to free up money for housing or retirement or spending it again, spending it at local businesses," added Voelker.
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Biden has also proposed free community college tuition, doubling Pell Grants, discharging student loan debt in bankruptcy, and canceling some student loan debt for students who attended public, historically black, or minority-serving colleges and universities.
"Anything that could help student loans, I'm not the only one with student loans. People have way more than $10,000. But to know that someone is coming in and taking $10,000 off your student loans, that's just huge," reacted Allen.
Biden is likely to find some support for these proposals as Democrats now control both the House and Senate.