Biden plans student-loan announcement Wednesday

White House officials plan to make an announcement Wednesday about his proposal to deal with President Biden Student loanAccording to those in the know.

The president and his senior aides have been weighing for months whether to cancel some federal student loan debt. Biden’s top advisers, Mr Many projects have been discussedThat includes eliminating $10,000 in federal student-loan debt for borrowers earning less than $125,000 a year, the people said.

The White House is closely guarding the details of the decision. Mr. Some said only a small group of Biden’s top aides had been briefed on his plans.

As of Tuesday evening, senior Biden administration officials were still ironing out the details of the announcement, according to some people familiar with the discussions. With an income limit of $125,000 per year, Mr. Those people said they expected Biden to pick, but cautioned that those figures could change.

The president is expected to extend a pandemic moratorium on federal student-loan payments.

Mr. Biden is scheduled to return to the White House on Wednesday from Delaware, where he is vacationing with his family. The President has said he will announce a decision on student loans by August 31.

The White House declined to comment on the specific timing of the announcement or provide additional details. A spokesman reiterated that the president would make his decision by the end of the month.

A move to forgive $10,000 in student loans under certain income limits would fall short of progressive Democratic demands for full student-loan cancellation or $50,000 per borrower, but would apply to the majority of the 40 million people who have a combined $1.6 million. Trillions in student-loans.

See also  Ukraine estimates Russia's death toll from the Crimea bombings to be significantly higher

Republicans have opposed broad student-loan forgiveness, saying such a move would be unfair to those who have already paid off their debt or haven’t gone to college and would worsen inflation.

A statement issued on Tuesday Ben Wharton Budget Model A one-time maximum loan forgiveness of $10,000 for a borrower with an annual income of less than $125,000 is estimated to cost about $300 billion.

Last month, more than 100 Democratic senators and House members from across the party’s ideological spectrum asked Biden to extend the debt moratorium beyond Aug. 31, citing continued economic hardship. Mr. Biden previously cited a similar rationale for extending the moratorium, Most recently in April.

The Biden administration is nearing a decision on student-loan forgiveness that will affect millions of Americans and reverberate in the upcoming midterm elections. Here are some key challenges that complicate the final decision. Description: Ryan Trefs

“Resuming student loan payments would force millions of borrowers to choose between paying off their federal student loans or putting a roof over their head, food on the table, or child care and health care,” the Democrats wrote.

Republicans opposed continuing the moratorium, arguing it would constitute “de facto debt forgiveness.” Senior House Republicans released a bill this month that would end the moratorium and overhaul other aspects of the federal student-loan portfolio. The bill is not expected to go anywhere while Democrats control Congress and the White House.

Whether the suspension should be extended, Mr. As Biden contemplates, the White House has confounded borrowers, debt service contractors and the education industry itself. Last month, management told loan servicers Avoid sending billing notices or other communications relating to the resumption of payments.

Loan servicers are contracted by the federal government to manage student loan payments. They work with borrowers to answer borrowers’ questions about how much they owe, where and how to send money, and repayment plans. Typically, they send billing notices at least 30 days before payments start, so borrowers can plan ahead.

On Monday, a group of creditors urged the administration to come to a decision, and said any move closer to the deadline would raise the chances of “incidents of borrower miscommunication,” according to a letter seen by The Wall Street Journal.

“You should be aware that any announcement at this late date, less than ten days before the planned reopening of September 1st, risks operational disruption,” wrote Scott Buchanan, president of the Student Loan Servicing Alliance, an industry group.

Write to Andrew Restuccia at [email protected] Gabriel D. at [email protected] Rubin and Tarini Parti at [email protected]

Copyright ©2022 Dow Jones & Company, Inc. All rights reserved. 87990cbe856818d5eddac44c7b1cdeb8

Leave a Reply

Your email address will not be published.