A particular hope filled the air (or at least social media) after Biden’s swearing in — the hope that student loan debt would be cancelled. Six months later, however, there are no clear signs this is happening, according to a Bloomberg News commentary. Even the $10,000 student loan debt cancellation Biden himself advocated prior to his election has yet to come to fruition. This matters because more than 40 million Americans are on borrowed time before having to resume payments on federal student loans. On March 27, 2020 the CARES Act suspended payments and collections on defaulted student loans, and brought interest rates down to 0% until Sept. 30, 2020. After a few extensions, this is set to expire on Sept. 30 of this year. The relief has been critical for millions during the pandemic, but it’s cost the U.S. government an estimated $53 billion, according to the administration’s recent proposed budget. It’s predicted to result in $68 billion in long-term losses, due to factors such as increased enrollment in income-driven repayment plans and potential defaults. The reality is, the federal government is not going to cancel the more than $1.7 trillion in student loan debt, according to the commentary. At some point, borrowers will have to start making regular payments and see interest accrue on what they owe.
