Thursday, September 21, 2023
HomeEconomyBiden expected to cancel student loans for millions of U.S. borrowers Wednesday

Biden expected to cancel student loans for millions of U.S. borrowers Wednesday

Nandita Bose

WASHINGTON (Reuters) – U.S. President Joe Biden will announce on Wednesday that the government will forgive the U.S. dollar 10, 000 to provide student loans to many of the country’s indebted college students, a move that sources said could increase the support in the midterm elections, but may also increase inflation.

Debt cancellation will free up hundreds of billions of dollars in new consumer spending, adding a new wrinkle to the country’s inflation struggle, economists say.

Democrats have urged Biden to forgive as much as $50,000 Every borrower believes that debt keeps young Americans from saving for a home down payment or other big consumer purchases. Republicans believe the move will disproportionately help people earn higher incomes.

U.S. consumers are saddled with a whopping $1.20 $1 trillion in student loan debt, most of which is held by the federal government, both private and national The result of the support is that college tuition is significantly higher than in most other wealthy countries.

Government extends moratorium on student loan repayments until the end of the year, while also announcing planned relief of up to $ ,000 Student Debt for Borrowers Earning Less than $

, one year.

will also cancel up to $20, in debt of Pell Grant recipients, approximately 6 million students from low-income families.

Cut $000,000 Federal debt per student will reach 321 $1 billion in federal student loans and eliminate 20 all balance*) 800,000 borrowers, or 31% of borrowers, according to a study by the Federal Reserve Bank of New York.

Pandemic-related government suspension of student loan interest and payments is due at the end of August. Borrower balances have been frozen since the COVID-19 outbreak , and most federal students have been frozen since March 2020 None of the loans require payment.



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