Republicans present alternative student loan forgiveness plan
The new rule comes as an opposition to the Biden administration’s plans
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As the Biden administration works on changing the federal student loan system, resulting in the forgiveness of loan debts for students in a variety of financial situations; it garnered a lot of attention — and, therefore, opposition.
According to Higher Ed Dive, a new rule, called the Responsible Education Assistance through Loan (REAL) Reforms Act, is an attempt to rework Biden’s costly and regressive student loan forgiveness plans, as Republicans say. It was released on Thursday, Aug. 4, and some of the changes proposed in the bill are as follows:
- Reduce the repayment options the U.S. Department of Education can offer to only two: a decade-long or an income-based option
- Eliminate the Public Service Loan forgiveness (PSLF) program
- Block the education secretary’s power from issuing new costly regulations
- Cut loan programs for graduate students: limiting the amount they can take out to $25,000 annually or no more than $100,000 for the duration of their degree program
- Allow federal Pell Grants to apply toward short-term programs
The PSLF program specifically forgives workers in fields such as nursing and government after a decade of qualifying payments. However, since it was created in 2007, few have received its benefits. When the Biden administration waived a few of PSLF requirements last year, more people were eligible due to its flexibility. The measure is temporary and ends in October.
Republicans aim to prevent the education secretary from issuing what they think as “illegal waivers for loan forgiveness programs." It is being spearheaded by Rep. Virginia Foxx of North Carolina, a ranking member of the House Education and Labor Committee, as well as Reps. Elise Stefanik of New York and Jim Banks of Indiana.
Democrats and progressive groups said they don’t agree with the proposal, saying it would make student loans more expensive and harder to pay, preventing low-income students from pursuing higher education.
To learn more about the new bill click here.