AMSA Celebrates Student Loan Forgiveness
Today, President Biden took a remarkable step for millions of Americans in student loan debt by forgiving $10,000 and by taking steps to make education more accessible. AMSA applauds this initiative and encourages President Biden to continue making strides towards more equitable education.
There are 45 million people in the country who are burdened with student debt in the United States. As the President stated during his announcement, this makes it significantly more difficult for them to buy houses, cars, health insurance, start and raise families, and otherwise participate fully in the economy. While the $10,000 loan forgiveness is not a lot for many people, even this amount will cancel the remainder of their balance and completely remove that burden from them. Of the roughly 42 million people eligible for this loan forgiveness, 20 million people would have the remaining balance of their income completely erased.
On top of this, President Biden takes steps to minimize the month to month impact on borrowers, allowing them to save more for the future by dropping the monthly payment maximum from 10% of discretionary income, to 5%. He is also ensuring that people will not need to pay for more than 20 years on any loan, or 10 years if the initial loan was less than $12,000. Meaning if you have been making payments for 20 years and still have not paid off your loan, the remaining balance will be forgiven. Twenty years is a long time, but considering that approximately a third of borrowers are over the age of 40, including 5% senior citizens, this will have a massive impact on millions of people.
There is no question that this will make a huge difference on millions of people. However, as medical students, we know this will have a small impact on the average medical student who owes over $240,000 in total student loans at graduation. Nor does it do much to solve the root of the problem of the cost for higher education. It takes steps towards promoting racial equality, but does not significantly lower the barrier for pursuing higher education. For medical school, Black students are 20% more likely to graduate with debt than their white counterparts with an average of $30k more debt.
So while we will celebrate the steps that have been taken by this administration, we also call on Congress and President Biden to take further steps towards making education accessible.
For more information from the White House, visit their website.
To get an email notification when the application opens visit the US Department of Education website.
This is an official Statement from the American Medical Student Association, written by Dr. Michael Walls, DO MPH, AMSA National President.