Biden to announce new student loan forgiveness proposals
President Biden will be announcing new proposals for partial or complete student loan forgiveness Monday in Wisconsin.
The main thrust for the latest round of student loan forgiveness proposals is to target accrued and capitalized interest on student loans. According to the Biden administration, 25 million Americans who used federal student loans now owe more than they originally borrowed because of the interest charges that have accumulated.
However, the president’s new loan forgiveness proposal will have to clear several hurdles before any student loan balances may be lowered.
struck down by the Supreme Court last year. The Department of Education relied on the 2003 HEROES Act as its legal justification for wiping out roughly $430 billion in debt. The law authorizes the education secretary to “waive or modify” student financial assistance programs for borrowers “in connection” with a national emergency, such as the pandemic. But the Supreme Court ruled that the law does not grant the secretary that authority.
Additionally, several Republican attorneys general are now challenging Mr. Biden’s second loan forgiveness process — the “SAVE Plan” — which is based on borrowers’ income and effectively cancels monthly payments for low-income Americans.
Asked about potential legal hurdles, the senior administration officials said they were “confident” in the legal basis.
Melissa Quinn contributed to this report.
Bo Erickson
Source: cbsnews.com