President Joe Biden on the South Lawn of the White House February 16, 2021.
Drew Angerer | Getty Images News | Getty Images
President Joe Biden has essentially ruled out the cancellation of $ 50,000 per person student debt – disappointing some borrowers who are counting on that help.
“I had no hope,” said Joshira Maduro, 30.
The research analyst graduated from Lehigh University in 2012 with a bachelor’s degree in finance and marketing and a $ 132,000 student loan. Since then, she has had a tight budget to afford her monthly payments.
The suspension of payments on federal student debt during the coronavirus pandemic has provided Maduro, who lives in Charlotte, North Carolina, with a rare opportunity to take off the rest of her high-interest loan and even start building an emergency fund.
In the meantime, the president’s proposal to cancel up to $ 10,000 in student debt per borrower that is still on the table would go a long way toward reaching even bigger financial milestones, such as buying a car or saving for the down payment a home.
“That’s essentially a full year of payments to get done,” she said. “Even if I’ve only saved a full year of that money, I’ll know that if something happens, I’ll be confident that I can bounce back.”
$ 10,000 would just scratch the surface for many
For others, $ 10,000 would be just a drop in the ocean. Kimberly Chatterjee, 29, took out approximately $ 200,000 in loans to attend New York University and graduated with degrees in English and Acting in 2014.
Up until the pandemic, the New Yorker had worked full-time as an actor and paid off about $ 50,000 in debt. Even now, despite being unemployed and having her payments cut off due to Covid, she is trying to put extra money into saving and paying off her student loan debt.
Kimberly Chatterjee, 29, paid out $ 50,000 out of the total of $ 200,000 she borrowed for NYU. $ 50,000 in debt relief would be “life changing,” she said.
Chatterjee backed off President Biden’s argument that he should not cancel $ 50,000 in debt to people attending elite schools.
“This idea that only the rich go to fancy schools is absolutely wrong,” said Chatterjee, who is also the project manager for the Be An #Arts Hero campaign for arts and culture professionals.
She added that her degree opened many doors for her in the performing arts as well. “In terms of my career and the work I was able to do, it was totally worth it for me and a decision I wouldn’t change,” she said.
What would it mean if $ 50,000 of their total debt were canceled? “It would change your life,” she said.
How Far Would $ 50,000 in Lending Go?
Of course, many argue that paying off student loan debt is unfair to those who have paid off their loans or made other decisions about higher education.
“There’s a fairness problem,” said Scott MacDonald, author of Education Without Debt. “So many people worked so hard to pay off debts – people who didn’t go to the college they wanted because they couldn’t afford it or didn’t take a vacation for years.”
However, others argue that canceling some of the $ 1.6 trillion in total student loan debt would benefit the economy and many Americans from all walks of life.
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If all federal federal loan borrowers were to forgive $ 10,000 of their debts, about a third of federal student loan borrowers, or 14.4 million people, would zero their balances, according to college expert Mark Kantrowitz. If $ 50,000 in educational debt were given away, all debt for 80% of borrowers or around 36 million people would be wiped out, according to Kantrowitz.
Studies also show that low-income borrowers, women, and people of color struggle the most with student loans – a pattern that only worsened during the pandemic.
And those calling for $ 50,000 debt relief on student loans say a lesser amount wouldn’t go as far to fill the racial wealth gap that black and brown Americans have, who have more educational debts than their whites Colleagues.
Demetrius Amparan, 30, is from the South Side of Chicago and the Donor Relations Manager for Young Chicago Writers, a nonprofit organization.
When 30-year-old Demetrius Amparan came to Valparaiso University, he took the opportunity to go to school as a first-generation student from Chicago’s South Side. His parents couldn’t help him pay for school, so he signed up for all the loans the college offered him.
“For black and brown people like me, [higher education] is like the most precious thing we can achieve, “said Amparan, who still lives in Windy City. In 2012, he graduated with a degree in communication, public relations and sociology.
Now, Amparan, the donor relations manager at Young Chicago Authors, owes more than $ 96,000 in student loans. As a nonprofit employee, he has never been able to consistently make the high monthly payments on his outstanding loans, especially because he has two young daughters, ages 7 and 10, whom he looks after.
He found Biden’s argument against the $ 50,000 debt relief wrong, he said, especially because he knows how much that kind of relief would help his community.
“It hit me pretty much when I heard it,” said Amparan.
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