Student Loan Relief Update

On February 4, 2021, United States Senator Elizabeth Warren (D-Mass.) and Senate Majority Leader Chuck Schumer (D-N.Y.), and Congresswoman Ayanna Pressley (D-Mass.) reintroduced a bicameral resolution asking President Biden to use his authority under the Higher Education Act to cancel up to $50,000 in student loan debt for Federal student loan borrowers. The resolution calls on the President to use executive authority to cancel student loan debt and ensure there is no tax liability for Federal student loan borrowers resulting from administrative debt cancellation. 

The resolution cites 43 million Americans holding over $1.5 trillion in student debt, the Covid-19 economic recession and unemployment, disparate impact on black, brown and female borrowers, and the burden on co-signors as cause for loan relief.   In addition to debt relief, the resolution calls for the President “to ensure that administrative debt cancellation helps close racial wealth gaps and avoids the bulk of Federal student loan debt cancellation benefits accruing to the wealthiest borrowers” and “to continue to pause student loan payments and interest accumulation for Federal student loan borrowers for the entire duration of the COVID–19 pandemic.  Id.

According to a press release issued by Senator Warren, [o]ver 325 civil rights, climate, health, labor, consumer rights, and student organizations have called on President Biden to cancel federal student debt using executive action, including American Federation of Teachers, National Education Association, The Education Trust, Hispanic Federation, NAACP, National Urban League, UnidosUS, League of United Latin American Citizens (LULAC), Minority Veterans of America, National Women's Law Center, SEIU, the American Psychological Association, Sunrise Movement, the United States Student Association, and Young Invincibles.

Initial reports on the Resolution indicate that President Biden is inclined to defer executive action on the request, preferring that Congress address student loan relief.