They stress urgency because loan repayments, paused for three years because of pandemic, are scheduled to resume Oct. 1
WASHINGTON – Leaders of 20 cities and counties have called on President Joe Biden to expedite promised student debt relief.
They represent more than 1.2 million borrowers with about $50 billion in student loan
Although Biden’s original proposal to forgive up to $20,000 per borrower was rejected by the U.S. Supreme Court, the administration is now working on a new forgiveness plan under the Higher Education Act (HEA) of 1965.
However, some believe the new approach is lengthy and unnecessary.
They stress the urgency because loan repayments, paused for three years because of the pandemic, are scheduled to resume Oct. 1.
They call on Biden to accelerate his commitment of up to $20,000 in student debt forgiveness and implement the new plan immediately.
The letter criticizes the Supreme Court decision for putting politics ahead of the American people.
Recent surveys show that a larger percentage of borrowers are unsure if they can afford the upcoming loan bills and that a significant portion of them are likely to refuse repayment.
The letter notes that the upcoming reboot of the student loan system could adversely affect 45 million Americans.
Complications could arise if the restart of loan payments coincides with a possible government shutdown.
It also points out that the U.S. Department of Education lacks a contingency strategy for handling Federal Student Aid operations without the pending funding.
Angela Hanks of Demos emphasized that the pandemic loan moratorium has saved many people from financial collapse and allowed them to meet their basic expenses.
Resuming payments could jeopardize the financial stability these borrowers have achieved over the years, despite the current positive economic trends.