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Attention parents of students in Western New York, the President Has made steps on the student loan forgiveness front. For future students, this is not a major deal at this point, but it does demonstrate that action will be taken in an effort to take some of the student loan debt off of borrowers (past students). Recently our College Planner Jeff Boron made an appearance on WBEN to talk about the recent changes.
Here are a few key notes from the interview.
Deferment Ending
Biden is expected to extend the deferment to the end of the year. The rumor is that Biden is planning on providing up to $10,000 in forgiveness to borrowers with less than $150,000 in income. This would be about 321 Billion dollars in total and would wipe out the balance of somewhere around 12 million borrowers total.
Controversy
It may be easy to consider a social entitlement program, but there will always be winners and losers. Some people will be disappointed, and people with income that exceeds the threshold will not be happy they don’t receive the benefits. There will also be folks who have worked hard to pay off their loans and generate income to pay for college, who won’t be happy about the next steps either way.
Income-Based Student Debt
These programs are based on pro-rated income status. You will still see interest, and it will still be a long time of making payments. Jeff gives his thoughts on this around 3:30 during the interview.
Best Piece of Advice on Student Loan Debt
Through this period, since March of 2020, Jeff has been advising students and families to make payments if they can. But he maintains the belief that patience is key, and to avoid paying back more than $10,000 in the next few months, as there seems to be a real push to see $10,000 in loan repayment within the next year.
Here’s the full interview, and of course if you ever have any questions about your college financial plan, just give us a call or fill out our contact form anytime! We are always available to help students and families better understand the process of college financial planning. It’s not easy, and during times like these, it becomes even more complicated, but know that when questions arise, we are your financial aid hotline here in Western New York!