The Biden Administration could offer student loan relief to Americans who earn less than $125,000 per year, White House Press Secretary Jen Psaki confirmed Tuesday, according to Bloomberg—as President Joe Biden mulls sweeping student loan forgiveness.
Psaki—who spoke to reporters while traveling onboard Air Force One—said the administration is “looking at steps to help people making less than $125,000 a year,” Bloomberg reporter Jennifer Jacobs tweeted.
The press secretary didn’t appear to offer specifics on any relief program, but Bloomberg reported Friday that Biden could forgive at least $10,000 in student loans per borrower.
Biden confirmed Thursday he’s weighing canceling “some” federal student loan debt, and he expects to make a decision within the next few weeks.
Psaki’s comments line up with a Saturday Washington Post story that said Biden’s student loan forgiveness program may be limited to individuals with incomes below $125,000 to $150,000 or couples whose incomes don’t exceed $250,000 to $300,000.
The Department of Education has paused all federal student loan payments and interest since March 2020, part of a pandemic-era policy set to expire in August—though the moratorium has been repeatedly extended in the past. For months, some Democrats like Senate Majority Leader Chuck Schumer (N.Y.) and Sen. Elizabeth Warren (Mass.) have pushed Biden to use executive action to permanently wipe out $50,000 in student loan debt per borrower. The president ruled out canceling $50,000 per person last week, but he said Thursday he’s “in the process of taking a hard look at whether there will be debt forgiveness.”
Eligibility for student loan forgiveness may be restricted. The Biden Administration is considering limiting loan cancellation to Americans who borrowed money for undergraduate programs and excluding law or medical school debt, the Post reported Saturday, citing unnamed sources. Medical and law school graduates often have larger student loan balances but better future income prospects than people with bachelor’s degrees.
Plans to cancel a fixed sum of student loan debt have drawn criticism from some corners, with skeptics arguing the initiative would disproportionately benefit the affluent. In a tweet last week, Sen. Mitt Romney (R-Utah) called the idea a “bribe” and suggested it was aimed at boosting Democrats’ standing with voters.
White House officials weigh income limits for student loan forgiveness (Washington Post)
4 Reasons Your Student Loans May Not Get Canceled (Forbes)