During a visit to Madison, Wisconsin, President Joe Biden unveiled updated plans to eliminate federal student debt, which would help millions of people.
Biden termed the court’s judgment a “mistake” but directed the Education Department to develop a new plan under a different legal framework. His most recent proposal is more focused than his previous one, concentrating on people who have significant challenges as a result of student debt.
“Today too many Americans, especially young people, are saddled with unsustainable debts in exchange for a college degree,” Biden said from an event in Madison, Wisconsin.
Consumer groups have long decried the fact that interest rates on federal student loans may surpass 8%, making it difficult for borrowers who fall behind or are on specific payment plans to pay down their amounts.
According to the Biden administration, more than 25 million federal student borrowers owe more than the amount borrowed.
It predicts that if the new proposal is implemented as suggested, debtors will have up to $20,000 in overdue interest on federal student loans erased, regardless of income.
“This relief can be life-changing,” Biden said in remarks in Wisconsin. “Folks, I will never stop to deliver student debt relief on hard-working Americans, and it’s only in the interest of America that we do it. And again, it’s for the good of our economy that’s growing stronger and stronger — and it is. By freeing millions of Americans from this crushing debt … it means they can finally get on with their lives, instead of their lives being put on hold.”