With the upcoming election just around the corner and the 2020 presidential candidates preparing their campaign, it's important to look at their stances on important issues. And what issue is hotter right now than the $1.5+ trillion student loan problem. It seems to be the biggest topic of the election and most candidates have come out with their plan on how to tackle it. If you're one of more than 45 million Americans affected by this problem, it could be a big factor in whom you vote for.
Donald Trump
The current president has proposed a few changes to the existing federal student loan programs. The first change is to end the Public Student Loan Forgiveness program. This program allows people who work in public service for 10 years and make their student loan payments have their student debt forgiven. However, only a little over 300 people have been approved for the program so far, which is less than 1% of applicants. The other 99% have been rejected for various reasons.
President Trump has also proposed simplifying the existing income based repayment programs into one consolidated program. Under his single income based program, undergraduate loans would be repaid at 12.5% of income for 15 years. Graduate loans would be at the same income percentage, but for 30 years. Both programs could end early if the loan is repaid with interest. President Trump has also proposed ending subsidized loans, which means that interest would accrue for students while they are still studying. This would make school more expensive in the long run.
Democratic 2020 Presidential Candidates
Joe Biden
The former vice president under Obama has yet to release a plan on how he plans to tackle the student loan crisis. However, he has mentioned that he wants to simplify and fix the Public Student Loan Forgiveness program that was mentioned earlier. In 2015, he has also mentioned that he would support making public universities free.
Elizabeth Warren
Elizabeth Warren has been vocal about her plan to cancel up to $50,000 for each lender making under $100,000 a year. After that, the amount forgiven will start to lower as a person makes more. Those making over $250,000 won't be eligible for any forgiveness. This program would also make private student loan debt eligible for cancellation. Warren also wants any cancellation to not be eligible to be taxed. This program would cancel debt for a majority of people who hold it, especially those with low income. She has also proposed making public universities tuition-free for everyone.
Bernie Sanders
One of the 2020 presidential candidates, Bernie Sanders ,wants to cancel all $1.6 trillion of student loan debt. Unlike Senator Warren, his plan will be available for all student loan borrowers. Bernie, like Warren, has proposed to make all public universities tuition-free. This program would expand access to university to the underprivileged.
Kamala Harris
Another presidential candidate, Kamala Harris, believes the current student loan system needs to change. She has proposed allowing borrowers to refinance high-interest loans at a lower rate, expanding income based repayment, and cracking down on for-profit colleges. The Senator has also claimed that she will fight to make community college free and four-year universities debt-free.
She also recently released her proposal to forgive student loans for Pell grant recipients. People who open a business for 3 years in a disadvantaged community can have $20,000 of their student loans forgiven. She will also allow for those eligible to defer their loans, interest-free, during business formation.
Pete Buttigieg
Pete Buttigieg, the mayor of South Bend, Indiana, has also brought up his ideas about student debt. It's also a problem all too familiar to him because him and his partner hold $130,000 of student debt. However, unlike other candidates, he is not an advocate of free university for all. He believes that college should be affordable for all and free for those with the lowest incomes. He has also advocated for expanding Pell grants and improving the Public Student Loan Forgiveness program. The mayor also believes that universities should be held accountable for their outcomes.
Andrew Yang
Andrew Yang, an entrepreneur from New York, has also joined the presidential race. Yang has proposed a plan that will allow students to pledge 10% of their income for 10 years and have any leftover debt forgiven. This is a simplification of current income based repayment plans offered by the government. He also wants to forgive student loans for those who need it most and make it easier to get rid of student loans in bankruptcy.
His ultimate goal is to make colleges cheaper by lowering their tuition and hold schools accountable for their outcomes. Yang wants to forgive debt for students who sought a degree under false pretenses and close schools that have a high default rate.
This upcoming election will be important to decide what happens to student loans. Knowing where the candidates stand on this issue will help you make an informed decision at the polls. If you hold student debt, your vote will make a difference in what happens with your loans.
