Christine McGuire, 40, said $10,000 in debt didn’t make much of a difference for her 2005 Bachelor of Public Administration degree from California State University. McGuire owed her $24,000, but her interest and fees swelled her debt. Up to $50,000 for her.
It’s a familiar story among black classmates she studied with, said McGuire, executive director of Young Adult political advocacy group Young Invincibles. “We all owe more now than when we started,” she said.
Still, the suspension of payments has given her and her husband, who owe $50,000 in a loan taken to get an associate’s degree at a for-profit school, some financial breathing room. . She saved $400 each month by not paying off her loan for the last two years, so she could put more money into paying her mortgage and refinance at a lower interest rate.
“It allowed us to really save and start building wealth for generations that had been blocked,” McGuire said.
Republicans call debt cancellation primarily a ration to high-income college graduates. Some economists have warned that colleges and universities may raise tuition fees in anticipation of future loan relief.
Congressional offices, outside groups, and even companies dealing with federal student loans are being forced to speculate on Mr. Biden’s eventual move. Representatives at two loan servicers have been responding to calls from borrowers seeking guidance on whether their bills will be due again in September for a month, but as of Tuesday, they were educating about the government’s plans. It said it had not received any guidance from the ministry.
Scott Buchanan, executive director of the Student Loan Servicing Alliance, an industry group, said: “We don’t know what the plan is. I have not been consulted about whether.” “That’s my deepest fear โ that they will announce something here and it will be unworkable.”
Erica L. Green contributed to the report.