House Democrats are significantly scaling back the student loan forgiveness provisions in their $3T coronavirus relief package, citing concerns about the cost:
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Initial plan would have provided up to $10K in loan forgiveness to all borrowers:
Revised plan would limit the $10K in loan forgiveness only to those borrowers who were “economically distressed” on the day *before* Trump declared a coronavirus national emergency (March 12).
Revised plan would limit the $10K in loan forgiveness only to those borrowers who were “economically distressed” on the day *before* Trump declared a coronavirus national emergency (March 12).
Borrowers would be considered "economically distressed" if their monthly payment under an income-based repayment plan was zero. Borrowers who are delinquent or in default -- or in financial hardship deferment or forbearance -- also qualify.
The changes would roughly cut in half the # of borrowers who qualify for loan forgiveness under the bill.
Dem aide says revised plan would provide some amount of relief to 20M+ federal borrowers, half of whom would have debt completely canceled. Unclear on #s for private loans.
Dem aide says revised plan would provide some amount of relief to 20M+ federal borrowers, half of whom would have debt completely canceled. Unclear on #s for private loans.
Full text of manager's amendment here: amendments-rules.house.gov/amendments/LOW…
UPDATED story w/ more details on the cost concerns, per Dem aide:
Just as original bill was being finalized, CBO estimated that the student loan forgiveness provision would cost $250-$300B -- which was much higher than lawmakers initial estimates.
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Just as original bill was being finalized, CBO estimated that the student loan forgiveness provision would cost $250-$300B -- which was much higher than lawmakers initial estimates.
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Unclear what the new CBO score of the scaled back loan forgiveness plan will be, but presumably significantly lower.
