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President Biden announces student loan debt relief plan

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President Biden announces student loan debt relief plan

President Joe Biden visited Clark Atlanta University on Jan. 11 to discuss the need for voting rights legislation and call on Congress to pass voting rights bills introduced by Georgia's senators. Photo by Zoe Seiler.

Atlanta, GA — United States President Joe Biden has announced a three-part plan to provide student loan debt relief to low- and middle-class borrowers.

Biden announced on Aug. 24 that the U.S. Department of Education will provide targeted debt relief to address the financial harms of the COVID-19 pandemic. Pell Grant recipients will receive up to $20,000 in debt cancellation for loans held by the Department of Education, according to a press release.

Non-Pell Grant recipients will be provided up to $10,000 in debt cancellation for loans held by the Department of Education.

“Borrowers are eligible for this relief if their individual income is less than $125,000 ($250,000 for married couples),” the press release states. “No high-income individual or high-income household – in the top 5% of incomes – will benefit from this action.”

Biden also extended the pause on federal student loan payments one final time until Dec. 31. Borrowers should expect to resume payments in January 2023.

The Department of Education is also proposing a new income-driven repayment plan that will cap monthly payments for undergraduate loans at 5% of the borrower’s discretionary income. Those who qualified for the Public Service Loan Forgiveness program will additionally be given an appropriate credit toward loan forgiveness.

For more information about the student debt relief plan, click here.

Rep. Nikema Williams (GA-5) said in a statement she welcomed the president’s announcement as she has been fighting to cancel student loan debt for her constituents.

“Far too many constituents tell me that due to student loan debt, instead of achieving the American dream, they are living an American nightmare,” Williams said. “While this announcement is an important step, it cannot be the last step to bring relief to the 44.7 million student-loan-debt-burdened Americans. In recent years, we’ve seen how people benefit if the federal government suspends collecting student loan payments. After today’s announcement, I will keep pushing for more student loan debt cancellation and legislative action on bills like my Clean Slate Series to ensure everyone has the opportunity to share in the promise of America.”

Sen. Raphael Warnock said the announcement is personal to him, as he attended college on Pell Grants and student scholarships.

“This announcement will help many Georgians, some of whom have been struggling with debt for decades, get their financial footing, and it will help keep our economy strong and growing,” Warnock said in a statement. “That’s why I’ve been pushing the Biden Administration since my swearing in to take aggressive action to provide relief to Georgians— especially Pell grant recipients and working class folks who went to technical school, vocational school, or community college.”

He added this is the first step for Georgia borrowers.

“So I’m going to keep fighting for additional student relief for all Georgians left struggling with student debt and to prevent future borrowers from carrying that same burden,” Warnock said. “That means addressing the underlying problem by making college more affordable and creating opportunities for Georgians looking to enter the workforce through job training and other programs that prepare workers for growing fields.”

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