This divide has made it difficult for President Biden to cancel student loans. While some progressives have urged the president to forgive student loan debt using executive action, the White House keeps previously indicated that Biden is waiting on Congress to enact student loan forgiveness legislation.
Since Congress has been unable to deliver on other parts of Biden’s agenda, including this new Create Straight back Finest investing costs, it would be difficult for lawmakers to pass student loan cancellation measures. Democrats hold a razor-thin 50-50 majority in the Senate, and it’s unknown if more moderate Democrats would vote in favor of forgiving student debt.
With the future of broad student loan forgiveness uncertain, some borrowers may be considering refinancing to a private loan at a lower interest rate. You can discover more about student loan refinancing and compare current interest rates across private lenders on Credible.
675K borrowers had student education loans forgiven, however, greater rescue is actually but really in the future
Since Biden took office, the Department of Education has extended nearly $15 billion worth of debt relief to about 675,000 borrowers through present student loan forgiveness apps. Here’s who has qualified for debt cancellation under the Biden administration:
Keep reading regarding the odds of education loan forgiveness within the 2022, also hence borrowers possess qualified for credit card debt relief in Biden administration
- Complete and you may long lasting handicap discharge (TPD). In , the Education Department announced that eligible borrowers would automatically qualify for a TPD discharge through existing data provided by the Social Security Administration (SSA). As a result, more than 400,000 borrowers with a total and permanent disability had $7 billion worth of federal student loans forgiven.
- Public service Loan Forgiveness (PSLF). Under this federal student loan repayment program, eligible full-time public servants can have the remaining balance of their Direct loans discharged after making 120 consecutive qualifying payments. The Biden administration overhauled this program in , which resulted in 70,000 borrowers receiving $5 billion worth of relief in 2021.
- Borrower coverage so you’re able to installment. About 92,000 borrowers who were misled by a school involved in misconduct qualified for $1.5 payday loans online Pennsylvania billion under the borrower defense program. This includes borrowers who attended the Court Reporting Institute, ITT Technical Institute, Marinello Schools of Beauty and Westwood College.
- Finalized university discharge. Another 115,000 ITT Tech students received $1.26 billion worth of student loan relief under the closed school discharge program. This round of loan discharges was granted to borrowers who left the now-defunct institution on or after , without completing their degree.
Although many borrowers have qualified for student debt relief, millions more still owe an outstanding student loan balance of $1.75 trillion, according to the latest Federal Reserve. It’s unclear whether Biden will deliver the widespread debt forgiveness he campaigned on, which means that some borrowers may be looking for alternative student loan repayment options.
One such method is refinancing to a private student loan at a lower interest rate. Student loan refinancing can help you reduce your monthly payments, pay off debt faster and save money on interest charges over time. But refinancing the federal education loan personal debt into a private loan will make you ineligible for select student loan forgiveness programs, income-driven repayment plans (IDR) and the current COVID-19 emergency forbearance period, which expires this May.
If you don’t plan on utilizing these benefits – or if you already have private student loans that don’t qualify for federal protections – then it may be worthwhile to refinance your student loan debt. Use Credible’s education loan refinance calculator to determine if this debt repayment strategy is right for your circumstances.