Joe Biden takes ‘unprecedented action’ that could affect your finances on October 1
Student loan debt relief has been a hotly contested political issue but President Joe Biden is still attempting to introduce some form of support.
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The Biden administration has outlined its next steps as part of its new student debt relief plan.
This follows the Supreme Court’s intervention in June which struck down President Joe Biden’s initial policy to loan debt.
As part of the White House’s agenda, certain groups of student loan borrowers will be targeted, namely those struggling financially and people who started making repayments decades past.
For many, this will be a step back from Biden’s initial plan which was considered much broader.
The US Department of Education published its policy considerations as part of its plan to offer loan relief.
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Miguel Cardona, the US Secretary of Education, confirmed the Biden administration’s plans to offer debt support.
He explained: “The Biden-Harris Administration has taken unprecedented action to fix the broken student loan system and deliver record amounts of student debt relief.
“Now, we are diligently moving through the regulatory process to advance debt relief for even more borrowers.”
For many borrowers, this announcement is welcome news ahead of the moratorium on federal student loan bills coming to an end on October 1.
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This was introduced during the Covid-19 pandemic with tens of millions of Americans saving money thanks to this policy.
Prior to this, interest on student loans began accruing once again as of the beginning of this month.
Initially, President Biden had sought to ease borrowers into repayment loans once again by forgoing up to $20,000 in student loan debt.
However, Republican states and campaigners sued to block this support which resulted in the Supreme Court’s decision to block the relief.
Despite this support being confirmed, legal experts are sounding the alarm that borrowers may not see this support until as late as 2025.
The previous attempt was introduced via executive order which resulted in it being struck down by the judiciary.
Mark Kantrowtiz, a higher education expert, told CNBC that the legislative process Biden is now taking will result in it taking longer to be a reality.
However, Mr Kantrowtiz added: “But the Department of Education might try implementing it sooner, perhaps around the time of the election.”
