As of June 2021, student loan outstanding was $ 1.7 trillion, according to the US Federal Reserve. Much of this debt has not been paid since the start of the COVID-19 pandemic and student loan payments have been suspended. All interest on these loans was also temporarily written off, and the collection of overdue loans was stopped. The Biden administration extended the pause, now it expires on January 31, 2022.
During a visit to Rochester earlier this week, US Senator Chuck Schumer donned a “Cancellation of Debt” face mask. A New York Democrat said it was time for the federal government to forgive a student debt of $ 50,000 per person.
“So many students carry this debt burden. A huge burden. College should go up. For too many children and their parents, it is an anchor around the ankles, ”Schumer said.
“We spoke with (President Joe Biden),” Schumer continued. “He didn’t take it off the table. We encourage everyone, their relatives and friends who care about it, to send an e-mail, letter, postcard or call to the president. “
Spokesman Joe Morell (D-25 Rochester) said it was unlikely that such a law would be passed at this time with so many other projects on the table. When it comes to solving student debt, Morell advocates free community colleges across the country, making it easier to refinance loans and potentially applying previously paid interest on student loans.
He is also one of the Congressional Democrats in favor of writing off $ 10,000 of debt per person. Morell will tie strings to forgiveness of debt.
“I think the talk about forgiveness is real. I think this is important. I think it will probably be more modest than some of our members say. It seems that this is the $ 10,000 figure that is gaining the most popularity, ”said Morell.
“I think it needs to be tested for needs,” Morell continued. “I think if you have a really high income in the United States, I’m not sure why working men and women, some of whom were unable to go to college, should write off their debts. So it has to be verified for funds. “
But when it comes to handling rising student debt, consultants like Pamela Hart, of the Rochester-based nonprofit consumer credit counseling service, say borrowers shouldn’t plan for it. Hart said many of her clients are not.
“They don’t count on it,” Hart said on Wednesday. “They look at it like this:“ They have this student loan debt if something happens and we were all blessed with it, be it $ 10,000 or $ 50 000 dollars. if you erase them, they would be happy. “
Hart advises his clients to take advantage of this “window of indulgence” to pay off the principal of their student loans, other debts, and work on their creditworthiness.
For other student loan borrowers, Hart’s colleague, Andrea Collin, has a warning. She said that the unusual length of this patience can be misleading.
“Don’t make yourself too comfortable. I know it’s hard to say because it’s been going on for so long, but don’t calm down and plan these payments. ”