SACRAMENTO, Calif. — President Joe Biden's announcement of widespread student loan forgiveness for more than 40 million Americans has obviously prompted a lot of questions.
Wednesday night, many viewers flooded ABC10's YouTube comments section, so now, we’re looking into some of the most asked questions.
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Question: Will the debt be passed onto taxpayers?
Answer: President Biden has not made it clear yet how he plans to pay for the forgiveness. But, a report by Andrew Lautz with the National Taxpayers Union says this could create on average a $2,000 burden per taxpayer over 10 years. For parents wondering if their Parent Plus loans are included in the forgiveness package, everything we've found points to yes.
Question: What if you’ve already paid off your loans? Will you be given a $10,000 refund check?
Answer: The financial experts we’ve talked to say this is unlikely. But, if you’ve been paying your federal loans during the pandemic moratorium, you can get a refund on those payments. Economist Mark Kantrowitz says a very small percentage of borrowers made payments during the pause. Studentaid.gov says to reach out to your loan service provider about a refund.
Question: Does the president even have the power to make something of this scale happen?
Answer: It's unclear. It’s not uncommon for Congress and the Supreme Court to challenge executive actions. Some legal experts are citing West Virginia vs. the EPA. The high court found that any single government agency doesn’t have the right to make a law that would have "economic or political significance" without the approval of congress. This order could be challenged with that precedent.
Lastly, with all of the changes, some people are concerned about missing out on updates to the status of your loans or the application for forgiveness. To sign up for email updates, just go to ed.gov/subscriptions.
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