What a Biden Win Means for Student Loan Cancellation

If you were hoping for student debt cancellation based on your presidential vote, don’t expect it to come soon. Although student debt cancellation was proposed by Biden, it could take time for it to happen. It’s definitely not something you should count on, as you plan to pay off your student debt.

Student loan interest rates have been very low for private lenders, and it may be time to look at refinancing. The refinancing risk is that you’ll lose any benefits that federal loans might give you, such as student loan forgiveness (or cancellation, if that ever happens). If you are plan on refinancing, make sure to check with multiple lenders to get the best rate. 

One thing we know is going to happen is that the student loan aid from the CARES Act is set to expire at the end of the month. Currently, student loan payments have been suspended until December, 31 and the interest rates on federal student loans have been set to 0%. During this time, you could elect to continue making interest-free payments to help lower your balance, but if you have not been making payments, you’ll want to make sure you’re ready to start paying them again.

Student loan payments were initially supposed to start back in September, but it was delayed until December. There was talk about another relief package, but that does not mean there would be further relief for student debt. At this point, it does not look like another relief package will happen until someone officially takes office for the next presidential term.

If you have had a change in your income recently and are not able to make your payments, make sure to apply for an income-based repayment plan to make your payments more manageable. You have several repayment options for federal student loans and can decrease your loan payments based on your income.

Don’t wait for the New Year to decide what you are doing with your student loans. Make sure to know your options in paying off your student loans, stick to a plan, and adjust when you have life changes.

What are your plans for your student loans? Please comment below the original post, sign up to receive future posts by email and share with your friends!