The New York Times says eliminating student loans for everyone is a ‘bad idea’

That New York Times The editors say eliminating student loans is a “bad idea” for everyone.

Here’s what you need to know – and what it means for your student loans.

student loans

A major blow to advocates of large-scale student loan cancellations New York Times The editorial board officially rejects student loan forgiveness for all borrowers. Among the highlights of the new editorial:

• The burden of student loan debt is “crushing” and has caused “lasting, generational damage to the lives of millions of Americans”;
• However, if President Joe Biden enacted a large-scale slashing of student loans by executive order, it would be “legally dubious, economically unsound, politically unencumbered, and educationally problematic”;
• Rather than wiping out student loans for everyone, the Biden administration should make higher education more affordable and help student-loan borrowers who are most financially vulnerable;
• The termination of student loans for all borrowers sets “bad precedent” and does not address the fact that future student loan borrowers will also take student loans;
• If Biden cancels student loans through an executive order, it “could be dragged into court for years”;
• If Biden proposes cancellation of student loans that Americans don’t see as fair, it could backfire on Democrats in the midterms; and
• Income limits for student loan forgiveness are “crucial”; Otherwise, student loan forgiveness disproportionately benefits higher-income earners. (Student Loan Forgiveness: Here are the potential income limits to qualify).

Biden could call in student loans, but with caveats

Biden Considers Sweeping Student Loan Forgiveness; however, it looks more purposeful. Biden could call in student loans in at least three ways. However, Biden may impose certain restrictions on who qualifies for student loan cancellations. For example, Biden could:

Another issue that has been overlooked: what happens to temporary student loan relief? Currently, the student loan pause ends on August 31, 2022. However, if Biden cancels student loans before then, the student loan waiver could mean the end of student loan relief. The argument is that when student loans are forfeited, there is less need, especially for financially vulnerable student loanees, to extend the student loan payment pause again.

Student Loan Forgiveness: Alternatives

Advocates of large-scale student loan cancellations point out that easing is essential to boost the economy, reduce inequality and help borrowers get out of debt so they can get married, start families and buy a home. However, if Biden decides not to call in student loans, there are other proactive steps he can take to help student loan borrowers. First, Biden could work with Congress to change bankruptcy laws to make it easier for student loan borrowers to start over with their student loans. Second, Biden, which has canceled more than $17 billion in student loans, could revise income-based repayment plans. (Student Loan Forgiveness: 5 Key Takeaways from the Big Announcement). It could automatically enroll borrowers for student loans, shorten the repayment period, and forgive student loans earlier. Third, Biden can freeze government loan forgiveness so more borrowers qualify for student loan forgiveness in exchange for government service.

Biden could announce a decision within weeks, but student loan borrowers should also have a game plan for student loan repayments. You may not qualify for student loan forgiveness, or if you do, not all of your student loans may be canceled. Here are some popular methods to pay off student loans faster:

Student Loans: Related Reading

Bill Maher: Student loan forgiveness is a “loser” problem

Biden Confirms He Won’t Call In $50,000 Student Loans – 5 Key Takeaways

Student Loan Forgiveness: 5 Key Takeaways From The Big Announcement

Student Loan Forgiveness: Who Could Qualify Under Biden’s Plan?