During the campaign, Biden said he would support $ 10,000 for forgiveness. White House officials said he was also considering setting an income threshold so that high-income borrowers could be excluded from debt relief.
While the massive cancellation of student loan debt could provide financial relief to millions of Americans, the consequences of such a significant political move – predicted or otherwise – are complex. The action alone would do nothing to reduce college costs for prospective borrowers or help those who have already paid for their diplomas.
CNN is talking to eight alumni about what it would mean for them if Biden canceled a student loan debt.
Lecturer: $ 68,000 student loan debt
“It’s pretty devastating,” said Lindsay Clausen, 33, who has watched her student loan debt rise from $ 40,000 to $ 68,000 since she completed her master’s degree – despite making regular payments.
Clausen went to New York State University in Potsdam for a bachelor’s degree in English language and education 6-12, choosing the school in part because the campus was close enough to live at home to save money. While teaching as a substitute, she decided to pursue her master’s degree – which must normally be obtained within five years of receiving her initial teacher’s certificate in order to teach in New York State.
When she completed her master’s degree in educational technology in 2014, teaching jobs were scarce in the Potsdam area and now her husband wanted to return home to Washington state. Clausen decided to move in with him, and a few years later she got a job as a training design coordinator at the university where she still works today. Her work allows her to combine her teaching and technological skills.
Clausen is included in an income-based repayment plan, one of several repayment options available to federal student loan borrowers. IDR plans allow the borrower to make smaller monthly payments that are tied to the borrower’s income and family size. But as smaller payments are made, almost nothing is going to pay off the principal and the amount of outstanding debt has increased.
Clausen can qualify for debt forgiveness after making 10 years of payments under the public service loan forgiveness program, as she works in the public sector. But Clausen is skeptical after reading how few people have qualified so far. Many borrowers did not qualify for forgiveness when they thought they would be because they had the wrong type of federal loan or were included in the wrong type of repayment plan. The Biden administration has temporarily expanded the PSLF program to eliminate problems faced by earlier borrowers and to count payments that may have been missed.
“Hope is the key word here. “I don’t necessarily bet 100% on that, because who knows what they will decide with the next administration,” she said.
Congress will have to take action to abolish the forgiveness of public service loans, something lawmakers failed to do after the Trump administration proposed cutting it from the federal budget for four years in a row.
If Biden cancels a student debt with one stroke of a pen, it will put an end to a lot of uncertainty and anxiety for Clausen. But she says $ 10,000 won’t make much of a difference.
“I wouldn’t be able to do what I do today if I didn’t have a degree. And I’m very proud of the work I did and the people I met along the way – it changed lives for sure, “Clausen said.
“I guess the part I’m struggling with is why we put access and education at all. “Because it seems to be something that limits only middle- and low-income people,” she added.
Human Resources Representative: $ 80,000 student loan debt
Monica Mitchell, 43, says she borrowed about $ 80,000 for “a better future that never happened.”
She enrolled twice at the now-closed Vatterott College, a for-profit school, first to earn a degree in computer programming and then in the school’s cosmetics program. She said neither of them has ultimately led her to better paid jobs and is currently working in human resources.
As a young single mother of two, Mitchell is considering enlisting in the army. But after her sister was sent to Iraq directly from the training camp, she decided instead to explore her college opportunities. She met with a recruiter from Vatterott College who had a campus near her home in Missouri.
“I wanted something fast and fast. Four years was too long to have two children. I think Waterloo would give me an advantage,” Mitchell recalled.
The program was not exactly what he expected. The instructors were moving fast, and she didn’t receive the training she thought she would need. She graduated with a degree in computer programming in 2004.
Five years later, she decided to enroll in a cosmetics program offered by Vatterott. But, she said, the school did not properly document her classes and those of other students – shortening their time and delaying their graduation dates. She left without a book after three or four months.
“It was a real waste of time. So, you see, years later I’m still in huge debt and I have nothing to show for it,” Mitchell said.
She lives mainly from salary to salary and has not been able to make any payments on her student loan debt. Loans fell short before the Covid-19 pandemic. The Biden administration has said it will move outstanding loans before ending the pandemic pause in payments, which could put it back on track.
What also disappointed Mitchell is that the government has repealed some federal student obligations for students from other for-profit schools who mislead their students. Those who were enrolled in Vatterott at its closure – citing economic and regulatory conditions – are also eligible for debt relief from the federal government, but that was years after Mitchell attended. She is not currently eligible for relief as far as she is aware.
The Biden administration is working to speed up the provision of relief to borrowers who have been deceived by their lucrative colleges.
“I just wonder why some students have been forgiven their loans and others, like me, are still burdened,” Mitchell said. “They had the same problems that I had, the same complaints that I had. It’s just a mess, “she added.
If part of her student loan debt was canceled, Mitchell considered going back to school in hopes of achieving the better future she was looking for.
Retired veteran: $ 0 student loan debt
Max Messer Jr., 63, has no student loan debt or his children, largely because he and his wife saved enough money to help pay for college.
The son of a coal miner, Messer joined the army immediately after high school so he could get help paying for college.
“I knew that my parents could not afford to send me to college. I decided that at that time the best way for me was to join the army,” Messer said.
He attended school in Maine, taking lessons at night while working full-time for the United States Air Force. After six years, he graduated with a bachelor’s degree in business management with a focus on human resources – and no student responsibilities. He paid part of the cost out of his own pocket, and the US Air Force covered the rest. Eventually, Messer made a career outside the military in human resources and is now retired.
His daughter is about to complete her bachelor’s degree and will seek teaching positions. His son is pursuing a five-year master’s program in mechanical engineering. Messer expects his savings and scholarships and leaves his children to allow them both to graduate without student obligations.
“My wife and I found a way to do it. We sacrificed ourselves so that our children would not have to take out student loans and start their lives more economically in adulthood,” Messer said.
Messer said it was not political and certainly not “anti-Biden”, but opposed the idea of canceling a debt on a federal student loan.
“It doesn’t seem fair to me. “If student loans are forgiven, that money will have to come from somewhere and most likely be the middle class,” he said.
Meteorologist: $ 61,000 student loan debt
“The system doesn’t work for us, it works against us,” said Angel Enriquez, 29, a first-generation college student.
Enriquez borrowed about $ 40,000 to earn a bachelor’s degree in meteorology from the University of Northern Colorado. After working for about five years as a meteorologist, he decided to pursue a master’s degree in ecology with a focus on hydrology and water security. He borrowed another $ 21,000 for his first year in the master’s program and will have to borrow for the final year.
It was the pandemic that made him reevaluate his life plan and go to graduate school. But he also believes the second degree has helped him find his dream job at the National Weather Service, which begins this month.
“I definitely don’t regret the choices I made to get to who I am,” Enriquez said. But he is disappointed with what the college costs him and other people in lower and middle class families.
Enriquez said his parents could not afford to help him pay for college. As immigrants from Mexico, they were unfamiliar with the American higher education system. But Enriquez felt he had to go to a four-year college to move on. He wanted to go to public school, but was on the waiting list and ended up in a more expensive school outside the state instead.
“I get angry when people say, ‘You shouldn’t have signed for these loans.’ We have no choice. Either we stay in the same class, in the same low-paid job, or we collect all this debt so that we can at least have more flexibility in our lives, “Enriquez said.
“I applaud anyone who is able to repay their student loans, but to one person …
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