Capitol Hill Blue Forums Thread Like Summary - Biden to Cancel $10,000 in Student Loan Debt

Biden to Cancel $10,000 in Student Loan Debt for Borrowers Earning Less Than $125,000

Why?

When I was young, I could not afford college. My single mother couldn't afford to send any of us kids to college. It cost too much.

When I was a little older, I looked into going to college myself and taking out loans to cover it. After hearing the repayment details, I decided that I would not take a chance on it. I didn't think I would be able to make the payments if I didn't get into the field I was seeking.

It was a choice on my part. It wasn't something that someone was forcing on me. I had a decision to take those loans and to take the chance that it would pay off - or not.

I decided not.

I don't understand why taxpayers should pay for the debt of others when those people could have chosen not to get into that risky situation in the first place.

Like other loans, we make decisions based on different circumstances, whether to take a loan for different things. I have had automobile loans. I get tired of having to repay them too. I also have a mortgage. Why can't I get the taxpayers to give me a break on my auto loan or mortgage and pay them back for me?

I fail to understand how an education loan should be any different than any other kind of loan.

BTW, even without college, I was able to make decisions, there we go again with that word - decisions - which have allowed me to work up to a 6 digit income and to be able to live comfortably (not rich by any means, but comfortable) - which I am thankful for.

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Doug

I think I may be confused. I have been under the idea that OUR government was funding, and collecting most of the higher education loans. That, I think, started with Obama.

There is also another little problem. China, right now, is graduating twice as many engineers, etc than we are. Our state higher education has lost a great deal of state money to function and most of the staff was underpaid. Now the staff is no longer in that state but, given the greed of state legislators, or legislators who don't want to tax to help pay the price, and the greed of the private, incredibly rich, universities the United States of America is no longer producing what the nation needs and the national politics has responded by slowing down replacements from foreign sources.

Now add in that the government of America decided that, rather than supporting our higher education they would put entire generations of educated into lifelong debt (except for the lucky few). I know, I have simplified this but the problem(s) are very real and get worse annually. We are the only nation in the developed world that makes it almost impossible for anybody to actually get educated without going bankrupt along the way. A more interesting thing is that those debts are not, I am told, not dealt with in bankruptcy court so the 18/20 year old dummy who signed up for the debt is well and truly screwed.

via CNN.com

Yesterday, a lawsuit was filed in federal court to block the Biden administration's plan to forgive $10,000 in federal student loan debt for folks with qualifying loans and income of less than $120,000 a year. The plan also offers an additional $10,000 in loan forgiveness to folks who received Pell grants, to target borrowers who were more likely to come from low-income families.

The lawsuit was filed by a dude named Frank Garrison who works for the Pacific Legal Foundation, an outfit described by CNN as a "a nonprofit libertarian law firm," and which is handling the lawsuit on Garrison's behalf. The Washington Post similarly describes the foundation as "a conservative public interest law firm in California."

As Judd Legum from the Popular Information website points out:


As Legum also points out, Garrison's lawsuit against loan forgiveness faces a few hurdles, mainly because to have standing to sue, the plaintiff needs to show not just that they think a government action is bad and wrong and will sap the vitality of the American people's precious bodily fluids, they also have to show that they have been harmed by the policy, which is a big ask when you're talking about a plan to relieve people's student debts. How is someone else getting up to $20,000 damaging to this Frank Garrison fellow?

The lawsuit claims, however, that Garrison will be harmed by having $20,000 of his own debt forgiven. The American Rescue Plan exempted any future federal loan forgiveness from federal taxes. But apparently coming out $19,000 ahead, in Indiana, would be a great injury to this Garrison fella.

White House Assistant Press Secretary Abdullah Hassan called the claim "baseless" because the program won't oblige anyone to accept loan forgiveness if they'd rather have their debt.

Also this Garrison dude, filed the lawsuit as a Indiana resident. Indiana is one of the few states that would tax student loan forgiveness provided by Biden's program as state income tax. The "problem" is that this dude's Linkedin page says he's a resident of DC.

A conniving lying Rwinger is trying to harm the middle-class and the poor by getting rid fo this benefit - and Garrison's employer is forum-shopping because it worked (for the most part) for the criminal orange clown with respect to Judge Cannon - it will become a component of the Rwing playbook in the future. So what else is new?

This is a reminder that conservatives would rather see poor folks get evicted and/or get saddled with debt than see big businesses have to sacrifice profit for the public good.

I consider student loans to be a shining example of complete failure of both state and national taxing districts. Education is necessary and that includes university level students. If the nation fails in that we will not win and the nation that does will. China, right now, is producing a lot more university trained than we are by a large degree. Virtually every other industrialized nation in the world understands this. If a student qualifies for university, and wants to go, the state takes care of that. The United States, however, has a plan which involves loaning enough money for the student to graduate and then keeps that student in debt for the rest of their lives. (except for the luck and the rich).

That means that we are going to have a lot of university graduates who are REALLY pissed off, and unhappy and, I suspect, easy pickings for folks looking for such (which tends to make me a bit nervous about the future). I know several and they are not happy campers. Then some goto work where they have also hired Indians, etc. to help and they find out that the Indians were put through university by their country. We keep being told we are the greatest, richest nation every to be and we are behaving like that and that is not good on any number of levels.

I personally know of several doctors who just said "to hell with it" and moved to Canada and plan to never return. I know of one heart specialist who, with her husband, saved 100,000.00 to pay on the debt and it didn't even cover the interest debt. She moved to Canada with her husband who was also a doctor but taught in Canada, graduated, spent 4 years working for the Canadian government who then forgave all debt. I think we actually had something like that but, obviously no more although I am not sure about that.

I am actually on two tracks to have my student loan forgiven.

Track One: The age of the loan...28 years old

...if track one fails, i will have track two as back-up.

Track Two: I did public service working for a school district

In Seattle they are currently holding a crazy that threw a woman down some concrete stairs trying to kill her. He is insane and everybody agrees on that. However, that being said, they are currently paying him 250.00 a day to stay in jail until there is room for him in the remaining place, in the state to put the insane. The only other choice was to turn him loose so he could try and kill somebody else.

https://www.dailymail.co.uk/news/ar...snt-receive-mental-health-treatment.html

I kinda thought that might have got the state politicians to do something about the problem. Nope, nada! Apparently the reason for the daily payment is to flag the problem and also because he does not belong in jail he belongs in a place to get help. That is a huge step forward!

I also suspect every other state has, exactly, the same problems in that we seem to have A LOT of crazies currently manning the streets. Its really time to fix this one. Oh, almost forgot, we also, nationally, don't have enough shrinks to deal with mental problems as well. One of the real problems is that sending the insane to prisons has been the solution for, at least, 20 years. Washington seems to be ahead of that curve but it also means that many state continue with prisons instead of help.

I also believe that its really time to start getting the needed university graduates to staff the nation. We are short of doctors, engineers, shrinks, and some others. How about using one we used to have and Canada still does. Get them into universities and, when they graduate, to goto work for gov to do what needs to be done for a few years and then they are forgiven any education debt afterwards.

This will make Rwingers' heads explode.

Currently ol' Joe's SecEd is prepping to go in front of the SCOTUS in March 2023 to argue against the various State Attorney's lawsuit to quash Joe's 10K - 20K student loan forgiveness.

Very cool.

...but the following is what will make Rwing heads explode.

Pretty much, everyone will be steered into Income Driven Repayment (IDR) currently set at 10% of discretionary income. On July 1, 2023, the maximum monthly repayment amount will go down to 5% of discretionary income.

Currently, if you have income-based repayment and your payments aren't enough to pay the interest on the loan, the unpaid amount of interest is capitalized back into your loan, so your balance still keeps rising every year.

Under the new plan, if a borrower’s payment isn’t high enough to cover the interest due that month, the remaining interest will not be charged or tacked onto the balance as it is today.

Additionally, the new proposal would tweak the definition of "discretionary income" - which currently uses a formula designed to exclude costs of food and rent for a given area - the new definition will exempt more income, which would result in lower payments, too. And instead of having to recertify your income-based repayment every year (oh yeah, I need to do that! Us student loan IDR'ers have to this by July 31st every year), borrowers who opt in to allow sharing of their information from IRS can just let the Student Loan program recalculate it annually.

But wait! There's more!!!

Back in April 2022, the Education Department announced it would be making up for some very bad behavior on the part of a lot of loan servicers by doing a one-time adjustment to the amount of time that borrowers need to make payments.

You see, the Education Department requires loan servicers to inform borrowers of all their repayment options so their loans won't go into delinquency, including the availability of income-driven repayment plans (IDR). But a review of actual practices found that instead of doing that, a lot of loan servicing companies steered borrowers who couldn't afford to make payments to put their loans in "forbearance," which means that the borrowers didn't have to make monthly payments, but the loans continued to accumulate capitalized interest, which rolled back into the total balance owed.

This is where I raise my hand and say "Oh yeah, that was me! Nobody told me anything about IDR plans until I applied for one a few years ago!"

So for ALL OF THOSE YEARS I was in forbearance, with interested being added and added and added and added, my loan will be reset this summer so that those forbearance months will be IDR months at $0 monthly payment (Yes! You can have $0 monthly IDR payments) and will count towards the 20 year termination of the loan.

Oh...did I forget that part? Yes I did! Every student loan will now terminate after 20 years - regardless. Grad loans will terminate after 25 years.

Pretty nifty huh?!? Thank you dark Brandon!!!

SOURCE: Federal Registry

Why would there ever be foreclosures if you could discharge a house mortgage through bankruptcy? Home equity is most people's majority of assets.

it's getting there...



I called the Dept of Ed today to find out what's going on with my loan. It's paid off at Navient, but does not show up at aidVantage. Dept of Ed said to call aidVantage.

I called aidVantage, they said the loan is in the process of being transferred to MOHELA. MOHELA is the servicer that forgives loans when folks have done government service or non-profit jobs. I worked for a school district for 12 years planning menus and buying food for a school district whose population was 83% of the students qualified for free and reduced meals.

On July 14, 2023, I received an email from the Department of Education stating that my student loan, all or in part, will be forgiven. I had until August 13, 2023 to opt out.

News of 804,000 loans to be forgiven made big news.

The CATO Institute, a Koch Bros entity filed suit to block this forgiveness. On August 14, 2023, the judge ruled that the CATO institute did not have standing. Read here why the judge stated that CATO Institute did not have standing.

Congratulations, Rick! It appears from your series of posts that they are exactly the kinds of behaviors that the Biden administration has been focusing on. That your $29K loan ballooned to nearly 4 times the original debt is the biggest problem with the program, and why it is such a drain on the economy.

You do realize Biden is cornered at every turn as to what he is able to do about this, yes?

The most important part of the student loan forgiveness is that 20 years of payments must be made. The rest of the loan is interest to the government. Interest = free money to the government.

The free money to the government is being done away with. I have no problem with that.

The interest on my $29,500k loan was literally $100k. THAT is outrageous.


My parents don't help me. Ergo, the student loan. When one is late teens/early 20s, 9% interest over the course of 20+ years, simply was not on the radar. Now-a-days, loans spell out just how much interested will accumulate and what the final payment will be. Back then, that wasn't done.

Today's student loan forgiveness is the result 2005 Bankruptcy Reform Act the Congress wrote, and GWBush signed, allows student loan forgiveness at 20 years of payments. It’s 2024, the law has been in effect for 19 years. The loans that are eligible for forgiveness are just now meeting the criteria for forgiveness.

The reasons why student loan forgiveness was written into the bankruptcy law is because the 2005 reform law made it impossible to ever roll student loans into bankruptcy – which many Boomers had done previously. This is another example of Boomer ladder-pulling.

Ol' Joe can be faulted for making the insinuation that he's forgiving loans, when in fact, he's simply enforcing a 2005 law.

What money is being given to student loan borrowers? The borrowers are paying back the principle.

Nothing is being given - but something IS being taken-away. That take-away is the 9% interest on 20 years worth of loan principle. It's free money that the Department of Education was to receive from the borrower.

Frankly 9% interest is usury. Then again, Congress had no qualms of charging that rate.