On Wednesday, President Joe Biden announced initiatives to extend the loan payment freeze until the end of the year and to cancel a part of federal student debt for eligible borrowers.
According to a statement from the White House, the Department of Education will forgive up to $10,000 in federal student loans for those with yearly incomes under $125,000 or married couples with combined incomes of no more than $250,000.
Recipients of Pell Grants will be eligible to eliminate up to $20,000 in debt. Biden additionally said that the suspension of federal student loan repayment will be extended one final time through Dec. 31.
Read More: Biden Lays Out Student Loan Relief Plan: Do You Qualify For Forgiveness?
What Happened: American borrowers are jovial. In an NPR article, William Alexander said the deal is "Literally life-changing," as his wife will have $20,000 of her debt wiped since she received Pell Grants.
The applause didn’t stop there: Max Caster, the rapping wrestler for All Elite Wrestling (AEW) on Wednesday approached the ring before a match dissing his opponent and said, “You little jerks get no respect, we wipe you out like Biden did student debt.”
Biden getting applause lines at pro wrestling. Tell me more about how canceling student debt is a political liability. https://t.co/iD6StcBS9J pic.twitter.com/oJ9wJRf9fV— John Brown Yacht Club � � (@rockrichard) August 25, 2022
Why It Matters: One in five Americans is in debt due to college loans. Nearly 48 million Americans owe nearly $1.75 trillion in student loan debt; of these 48 million, roughly 43 million will be eligible for some debt forgiveness under the new Biden administration initiative, and roughly 20 million may have all of their obligations erased.
Nearly 43% of borrowers could potentially have their federal student debts totally forgiven this year because of the program, which is projected to cost around $300 billion.
Photo: AEW YouTube screenshot; Shutterstock
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