Senator Bernie Sanders wants President Joe Biden to cancel all student loan debt.
Here’s what you need to know.
Bernie Sanders is back. After stepping out of the spotlight in the fight to cancel student loans, Sanders (I-VT) is now front and center. His most recent statement: Sanders is now asking Biden to forgive all $1.8 trillion in student loans, including private and federal student loans. This is the most ambitious proposal to cancel student loans because, if passed, it completely eliminate 100% of student debt for the 45 million student borrowers. Sanders proposed this legislation to Congress and made the complete cancellation of student loans a centerpiece of his presidential campaigns.
(Student loan cancellation reduced to $25,000).
Sanders would cancel more student loans than Elizabeth Warren
Sen. Elizabeth Warren (D-MA) has emerged as the U.S. Senate’s top champion for large-scale student loan forgiveness. (The student loan forgiveness could be the reason the Democrats lose the midterm elections). How does his plan compare to Sanders’ plan? Sanders would cancel all student debt. However, a proposal by Warren and Senate Majority Leader Chuck Schumer (D-NY) would forgive up to $50,000 in student loans. If passed, the Warren-Schumer plan would completely cancel student loans for 36 million student borrowers. However, there are limits to the Warren-Schumer plan. (Here’s Who Won’t Get Student Loan Forgiveness). For example, their plan would only apply to federal student loans. By contrast, Sanders’ plan for student loan forgiveness would include the cancellation of private and federal student loans. The Warren-Schumer plan would also limit student loan forgiveness to borrowers who earn up to $125,000 a year. In contrast, the Sanders plan would grant student loan forgiveness to every student borrower, regardless of income.
(Will student loan repayments be postponed until 2023?).
What the Sanders plan means for your student loans
What does the Sanders plan for student loan forgiveness mean for your student loans? (Here are 6 major changes to student loan forgiveness). Virtually, Congress will not pass the Sanders plan because there is virtually no support for large-scale student loan forgiveness of all student loan debt. Congress also won’t approve Warren and Schumer’s plan to forgive up to $50,000 in student loans. That said, Sanders’ voice carries considerable weight within the Democratic Party. (3 ways to get student loan forgiveness now). He represents the progressive side of the Democratic Party and finished second to Biden in the 2020 presidential race and second to Hillary Clinton in 2016. Along with other advocates such as Rep. Alexandria Ocasio-Cortez (D-NY) and Ayanna Pressley (D-MA), Sanders could help pressure Biden to enact large-scale student loan forgiveness through an executive order. (Biden canceled $15 billion in student loans). To date, however, Biden has pushed back on that idea, saying he doesn’t think he has such authority to unilaterally cancel student loans without Congress.
(Student loan refinance rates are ridiculously low).
Student loans: next steps
The next steps for your student loans is to watch the latest headlines on student loan relief and forgiveness. Student loan relief – including temporary student loan forbearance – is expected to end soon. This is why it is essential that you prepare for the end of student loan relief. While Biden could extend student loan relief, the White House and Education Department have focused on restarting student loan payments as planned.
Make sure you know each of your student loan repayment options, including these popular ways to pay off student loans faster: