The President of the United States of America, Joe Biden, has announced plans to cancel $10,000 in student loan debts for tens of millions of Americans. The President revealed that he would forgive $10,000 for families earning less than $125,000 per year and $20,000 for those who had benefited from the Pell grants for low-income families.
According to the US Department of Education, those not automatically included amongst the eight million borrowers to benefit from the forgiveness plan would have to apply for it.
What they are saying
The US President, while speaking in the White House, said that this relief would ease the financial burden and give breathing room to working and middle-class families. The President also announced that his administration would pause the repayment of student loans till 31st December 2022.
What you should know
Student loan debts in the US pegs at $1.75 trillion with a huge chunk of it held by the federal government. The pardon by President Joe Biden affects about eight million borrowers.
A New York Federal Reserve Research disclosed that the $10,000 forgiveness for every student would cost $321 billion and ease the financial burden on 11.8 million borrowers.