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ED Expected to Soon Submit Debt Cancellation Memo

By Hugh T. Ferguson, NASFAA Staff Reporter 

The Departments of Education’s (ED) recent actions concerning targeted student debt relief has brought the issue of broad debt forgiveness back to the forefront, with the department pledging to analyze executive authority on the matter.

President Joe Biden’s Chief of Staff Ron Klein recently said the White House is looking into the administration’s legal authority to cancel student loan debt through executive action. Following that pledge, Education Secretary Miguel Cardona held a meeting with a number of stakeholders who have urged for federal student debt cancelation in order “to find a path forward." 

Cardona’s meeting included Senate Majority Leader Chuck Schumer (D-N.Y.) and Sen. Elizabeth Warren (D-Mass.), who have been urging the White House to cancel up to $50,000 in federally-held debt per borrower.

The highly anticipated memo will largely determine how the Biden administration proceeds on the issue of debt forgiveness. 

For more information surrounding student loan debt relief, be sure to listen to NASFAA’s special "Off The Cuff" episode: All Things Student Loan Forgiveness and stay tuned to Today’s News for more developments.

 

Publication Date: 4/5/2021


Aaron S | 5/3/2021 8:32:30 AM

I continue to argue the point put forth by Justin in which NASFAA believes in fixing federal financial aid before any loan forgiveness. The federal government can forgive the entirety of the debt and within a few short months, we'll be looking at another 1.1 billion dollars in loans issued to students expecting forgiveness. Congress must address the current aid plan first.

Robert W | 4/5/2021 3:34:48 PM

I am opposed to this idea as a tax payer and a parent who paid off a Plus loan and whose children paid off their studen loans. The Feds made the loans to students at student request. Why should the taxpayers forgive them? Affordability is not the the Feds responsibility nor the taxpayers. If the student does not think they got their money's worth they should take it up with the school. Affordability is a school issue.

Students have many institutions to chose from with a variety of price points. Many students still fund all or part of their education by working. Plus there are a lot of loan forgiveness options available now and employer paid loan forgiveness.

This is a very reckless, knee jerk idea and this is my opinion only.

Bob Walker

Jeff A | 4/5/2021 10:1:25 AM

Bad policy, period. The unfairness, faults and ethical concerns are numerous. Tthe rhetoric about forgiving debt is only encouraging many to take on considerably more debt than they would otherwise expecting it to be forgiven.
Borrow as much as you can going forward as well, thinking there could be another round of forgiven debt in the future.


David S | 4/5/2021 8:57:42 AM

Good to hear. If we as a profession stand for affordability, we need to recognize that affordability is much more than an aid package that gets a student to decide to enroll, or one that squares them away at the Bursar's Office. When student loans are one of the primary vehicles by which we make college enrollment possible, then we must recognize that the issue of affordability lasts for years, even decades, after the student leaves, whether they graduate with honors or leave without completing a degree or credential.

I understand the arguments that canceling debt today does nothing to help the student who needs to borrow tomorrow. But the solutions I hear our profession suggesting (more Pell, eliminate negative amortization, etc) do the opposite; solutions for tomorrow but none for what happened yesterday.

The issue of student loan debt and its impact on the economy and on peoples' lives is not a binary argument; there's lots at play. But the issue of whether or not to cancel some level of existing student loan debt, and for whom (maybe an income limit?) is; you're either ultimately going to be in favor of it, or you're going to oppose it. What side of that debate do we want to be on?

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