Like everywhere else in the United States, plenty of Central Oregonians have to bear the burden of student debt.
But President Biden’s new debt relief plan would be a game-changer for current and former students.
The plan would allow $10,000 in debt forgiveness for individuals making under $125,000 a year or families earning less than $250,000. Those who received a Pell Grant will be eligible for $20,000 in relief.
Ian Snyder, a senior at OSU-Cascades, said he didn’t think it would really happen.
“I’m just excited that it’s actually happening, because it’s one of those things that gets promised and you never hear about it again,” he said.
An estimated 43 million borrowers will benefit. It’s a reduction on the $1.6 trillion owed in federal student debt across the nation.
“I think I’m about somewhere between 40 to 50 thousand in debt and I’m a Pell Grant student,” Snyder said. “So we could be like up to half my debt gets forgiven, so a pretty big chunk.”
Shane Kelly, another OSU-Cascades senior, already has around $40,000 in student debt.
“Once I get a job after I graduate, it probably will take awhile to pay it off so this loan forgiveness will definitely help me with that,” he said.
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20 million borrowers will have their debt completely canceled through the plan, like Bend photographer Caleb Thomas who is still paying off loans from the OSU degree he earned in 2012.
When he graduated, he had around $22,000 in student debt. It has taken him 10 years to reduce that number to around $3,000.
“My student debt payments were about $220 a month, just always having that over my head,” he said. “Now knowing that those payments are not something that’s necessarily going to come back, I can take that money and reinvest into the business. I can rent a space for myself. I can expand, I can bring on another person to help with administrative stuff. Getting that off our shoulders, it opens up an entirely new world.”
Thomas believes student debt has prevented his generation from being able to participate in life in the same way as previous generations.
“I know that $1.6 trillion amongst people could be used to start businesses, could be used to revolutionize our economy, to bring kids into this world, to buy homes, to build homes, to buy property. To do all of the things that normal people throughout our generations have been able to do,” he said.
For some, the relief means the chance to dream a little bigger.
Snyder said he thought he would be able to pay off his loans in half the time because of the forgiveness.
“I’d like to get my own property and build a house on it at some point, so that’s probably my next biggest thing after paying off student debt,” he said.
Kelly works two on-campus jobs to help pay for the cost of tuition, and he was excited at the chance to save money for other ventures.
“Maybe just like buying a new car, looking for living off-campus here in Bend,” he said.
While the break is welcome, the root cause of the debt and the cost for taxpayers is a concern for many.
“Giving the American people a little reprieve from their student debt payments, I couldn’t care less if it means we pay more in taxes or have more in national debt,” Thomas said. “We’re not going to be that shining city on a hill if we keep saddling all of these generations with debt that they will never be able to pay in their lifetime. And that’s just going to put us further behind the rest of the modern world.”
Biden made the move under the 2003 HEROES Act, which gives the president the authority to reduce or remove student debt during a national emergency, like the one that still remains in effect due to the COVID-19 pandemic.
There is still a chance for legal challenges as questions arise regarding a potential executive overreach.
More information about how to apply for loan forgiveness will be released in the coming days on the federal student loan website.