Democratic representatives believe the president has the authority to cancel student loan debt
Reps. A group of progressive lawmakers, including Ilhan Omar (D-Min.) and Alexandria Ocasio-Cortez (D.N.Y.), are calling on the Biden administration to issue a memo from the Department of Education to revoke the president’s legal authority . student loan debt.
This is what the Biden administration said in April Asked Education Secretary Miguel Cardona for the memo. At the time, White House Chief of Staff Ron Klein said it would be released in a few weeks, but six months had passed since then. Progressive MPs’ letter sent late last week.
Now, they’re urging it to release by October 22 to “set limits on the administration’s authority to comprehensively cancel student loans through administrative action.”
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The letter also urges President Joe Biden to cancel student loans with the “flicker of his pen,” which has become a common statement among progressives who claim that the president has no access to federal student loans. have the right to forgive.
“Decades ago, Congress voted to authorize the executive branch to cancel federal student loans,” the letter said. “This authority is already being put into use, as it is currently being used to cancel the interest owed on all federally held student loans. Now it is time for you to honor your campaign pledge and for all students It’s time to use this authorization to cancel the loan.”
The letter cites legal scholars from Harvard Law and 80 members of Congress who confirm that the president can cancel student loans through the Higher Education Act. But not all lawmakers agree on the president’s authority to forgive student loans. And it’s still unclear whether President Biden will move to enact comprehensive student loan forgiveness legislation.
Keep reading to learn more about the potential for student loan debt relief and how you can reduce your student loan debt, including alternative loan forgiveness programs and private student loan refinancing. If you decide to refinance your student loan debt, be sure to compare the offers from several lenders on Credible’s online marketplace without affecting your credit score.
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The Biden administration has since January canceled nearly $10 billion in student loan debt, which borrowers eligible for programs such as repayment, total and permanent disability discharge (TPD) and closed school leave. The Education Department has also made it easier for 550,000 debtors to qualify for Public Service Loan Forgiveness (PSLF).
But comprehensive student loan cancellation can be hard for an administration to achieve. Biden himself has not previously supported comprehensive student loan forgiveness proposals. And House Speaker Nancy Pelosi (D-Calif.) has also said that canceling student loan debt “should be an act of Congress.”
This is not in line with many of his Democratic colleagues, including Senate Majority Leader Chuck Schumer (D.N.Y.) and Sen. Elizabeth Warren (D-Mass.).
“We don’t really have to do anything in Congress. The President of the United States has the power to cancel student loan debt on his own.”
The prospect of a massive student loan forgiveness remains unknown, though progressives may continue to heat up on the president as the federal forbearance deadline draws near the end of January 2022.
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How to reduce your student loan debt as payments are ready to start again
NS Education loans worth $1.7 trillion Student loans are a financial burden for borrowers, who may have to postpone other financial milestones such as buying a home or saving for retirement in order to manage their loan balances.. And with federal student loan payments resuming in February 2022, borrowers have little time to get their finances in order.
Private and federal student loan borrowers should consider some ways to reduce their debt before the COVID-19 administrative forbearance period ends.
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1. Refinance at a lower interest rate
Student loan refinancing is when you take out a new loan to pay off your current loan with better terms. By consolidating and refinancing a lower student loan rate, it is possible to lower your monthly payment or pay off your loan faster.
A recent credible analysis found that borrowers who refinanced for longer-term loans were able to reduce their monthly payments by an average of more than $250 over time, without adding to the total cost of interest. Those who refinanced for shorter-term loans were able to pay off their loans 41 months faster and saved about $17,000 over the life of the loan.
Plus, student loan rates are near historic lows, according to data from Credible. You can see the fixed and variable interest rates offered by genuine private student lenders in the table below.
Student loan refinancing may be able to provide you with a lower interest rate, but it is not. right for all. Refinancing your federal student loans for a private student loan will make you ineligible for certain federal protections, including income-driven repayment plans and student loan forgiveness programs.
If you decide that refinancing is right for you, compare rates from multiple lenders at once on Credible’s online marketplace. Then, use the student loan refinance calculator to determine your projected savings.
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2. Research Alternative Student Loan Forgiveness Program
Comprehensive student loan forgiveness may still be out of reach, but there are plenty of college loan forgiveness programs you may qualify for. Here’s something:
- NS Public Service Loan Waiver program. Full-time public servants, such as federal employees and nonprofit employees, may be eligible to have the remainder of their federal student loan debt discharged after 120 consecutive qualifying payments or 10 years of payment.
- NS teacher loan waiver program. Teachers who have spent at least five consecutive academic years teaching at a low-income school may be eligible to have a portion of their federal student loan debt discharged.
- Military student loan repayment. All branches of the military offer their own unique student loan forgiveness program. For example, army $65,000. offers up to College loan repayment for active-duty military service members who meet certain eligibility requirements.
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3. Make more than the minimum payment
Student loans are like any other type of fixed-rate loan: The longer the loan term, the more you pay in interest over time. By paying more than the required minimum amount on your federal loans, you’ll be able to save money in the long run while paying off your loans faster.
You can use Credible’s student loan calculator to see how changing your payment amount can reduce the cost of borrowing over time.
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