Possible Student Debt Cancellation Coming Soon?

• Author: Monica Jackson
• Posted: 2024-08-27

During the presidential campaign of 2020, then-candidate Joe Biden stated that he would seriously look into canceling certain student debt if elected. Although he did not technically make a clear promise, most people assumed that this would occur under his administration. However, since elected, that has not occurred, and many within the Democratic party are now starting to put pressure on him to make this happen. This has already been seen by some members of the party threatening to either vote no or simply not show up for critical legislation. So, does this mean that student debt cancellation is just around the corner?

Possible Reasons for the Slow Progress

As stated above, President Biden has been hammered by activists and members from within his own party about his lack of motivation to get this done. However, according to the President, other items of necessity needed to be taken care of first. For example, the push for a third stimulus package was something that, although both parties agreed on, the details often halted a clear vote on it. Next included the rollout of the covid vaccine that was desperately needed to jumpstart the economy and the push to get an infrastructure deal voted on. Lastly, the President has pointed towards the pause on student loan payments as a reason why he can still focus on other items while not negatively affecting those with student loans.

RoadBlocks

Although most people would like to see a total wipeout of student loan debt, the fact is that making that happen may be a little too difficult and lengthy of a fight to take on. One of the biggest concerns regarding this includes the fact that not all student loans are created and distributed by the federal government. This means that if President Biden signed an executive order tomorrow effectively forgiving all student debt, that would mean that only those with federal loans would be forgiven. Executive powers cannot force private lenders to do anything, and thus roadblocks begin to pile up. This issue has already been realized by members of Congress and by President Biden and thus have begun to create legal communities to determine the best legal route that they can take to ensure that they are canceling the most amount of student debt.

50K Cancellation Goal

One of the most common numbers being thrown out there is $50,000. Members of Congress, including Senate Majority Leader Chuck Schumer, Massachusetts Sen. Elizabeth Warren, and other leading Democrats, are traveling the country and appearing on network news about wanting President Biden to look closely at making this his target number. As stated above, this number is one that President Biden is concerned about actually reaching but one that is not being taken off the table for the time being.

Progress Being Made

Contrary to popular belief, President Biden has already canceled some student debt. The administration was able to cancel $2.3 billion in student loan debt from individuals who believe that their school had scammed them or who are now permanently disabled. An additional $500 million was also forgiven from students who attended ITT Technical Institute, which went out of business in 2016. However, with 43 million people still being crushed by their student debt, you can see how some may say that this isn't enough action to call it progress.

Take Action Now

Although a priority for members of Congress as well as the President, the unfortunate reality is that student loan debt still has a long way to go until it's actually canceled. There are simply too many roadblocks and various other factors that need to be addressed before your student loan debt is wiped out for good. However, that does not mean you should sit and wait. The first thing to know is that the government has placed a pause on student loan payments. This means that most Americans do not have to submit a payment nor have the risk of building up interest charges. However, that pause is not going to be there forever. That is why now is the time to begin looking for ways to make your payments much easier to handle, whether that is by starting to save right now or talking to your specific lender about lowering monthly payments.