Temporary Debt to Education

New Student Loan Forgiveness Program


Student debt repayment was slowed and stopped during the pandemic by the Biden administration. Now that the aid from last year has ceased, a new student debt plan has been put forward. – Made in Canvas

A new student loan forgiveness program focused on helping working and middle class borrowers pay off their student loans was put forward by the Biden administration in late 2021 and will be enacted in early October 2022.

Based on economic challenges caused by COVID and federal aid ending afterward, the plan targets loan relief for low and middle income families with the Department of Education giving nearly 8 million people automatic relief using relevant income data. Marlon Hernandez (9) agrees with the sentiment of this part of the proposal and sees it as a positive.

“I think that’s a good thing because it keeps them out of debt since they don’t have to pay off that huge loan that they have,” Hernandez said.

One example of who the plan is aimed at are borrowers who make less than $125,000 a year individually. The Department of Education will forgive up to $20,000 for borrowers at high risk or previous Pell Grant recipients, which is a grant given to students of exceptional financial need, and others may receive up to $10,000 in relief. These rules are also being instituted in order for other students that meet these criteria in the future to be eligible. Madeleine Hill (11) is interested in the idea of paying off student loans as long as the system helps both old and new borrowers.

“It seems helpful to pay back student loan debt but it also seems unfair to those who are gonna go to college in the future,” Hill said. “Who’s gonna help them with their debt?”

The set timetable for when the program will be the most viable is also connected to the Student Loan Payment Pause. It began in March 2022 and will end in January 2023, essentially stopping borrowers from paying their debts until the pause ends. David Owens, U.S. history teacher, has no particular feelings about the pause itself but ponders what effect it could have on upcoming elections.

“When the loans were placed on pause, some questioned the timing in relation to the upcoming midterms,” Owens said. “I just wonder what effect it will have at this point…how [the electorate] will interpret what this means to them personally given the 24 hour news cycle and the variety of other issues facing the country at the moment.”

An application for the program is supposed to open in early October at some point and can be found on the Department of Education’s website. Borrowers are advised to apply before Nov. 15 in order to receive relief before the debt pause ends in January even though the Department of Education will process applications even after the pause is ended. Once a borrower has completed the application process, they should expect to receive their relief between four to six weeks. Jayden Whitmire (12) feels that this plan would help change the perception of having to pay high amounts for college with no relief.

“I feel like it would just balance the hostility a lot of people have just because of how much they have to pay,” Whitmire said.

Borrowers who are employed by non-profits, the military, the federal government, a state government, a Tribal government, or a local government may be eligible to have all their student debt forgiven through the Public Service Loan Forgiveness (PSLF) Program as there have been eligibility requirements that have been waived until Oct. 31, 2022. PSLF forgives the remaining balance of your federal student loans for any employee that works full-time for a government entity or an approved non-profit and has made 120 payments while working for that entity, such as teachers who work in public schools. Megan Ross, an English teacher, likes how the program attempts to reward people employed in public service.

“Any incentive to keep teachers or retain teachers or to get teachers would be good,” Ross said.

The administration decided to roll back eligbilty requirements on Sept. 29, saying that only those that apply for the Direct Loan Program will be eligible which leaves around 770,000 borrowers excluded. Scaling back helps the plan fend off lawsuits from those saying it is an unchecked use of executive power.

“The federal government is losing something like 500 billion dollars in revenue from these loans being forgiven,” Owens said. “Any time a government loses money in revenue, they have to make it up in another way.”