ORLANDO, Fla. — Central Florida young professionals, students and parents are on edge this week as they wait for an expected announcement about student loans from the Biden administration.
At the moment, payments are set to resume on September 1 after a two-and-a-half-year pause. If Biden lets the deadline pass, more than two million Florida families will be affected. The average debt owed Is $38,000, according to data shared by Yrefy.
President Biden has extended the deadline multiple times as he confronts the political nature of soaring student debt. He promised on the campaign trail to tackle it to win over younger voters. Democrats have been clamoring for $50,000 in forgiveness, though White House officials said Biden was mulling over $10,000 in forgiveness for all but wealthy borrowers instead.
Yrefy Managing Partner Mary Jo Terry said there was a good chance Biden would opt to punt the issue until after the November election instead.
“A lot of people are getting more nervous as the closer these dates get knowing that the budget that they had for federal loans has gone somewhere else,” she said.
Terry offered two pieces of advice for borrowers and families: first, pretend as if Biden won’t take any action. Make sure accounts are up to date and budgets are prepared to take the $400 average monthly payment.
Secondly, she said borrowers should take advantage of the interest-free period while it lasts. Any payments before September 1 will go toward the principle, knocking down the interest and the total cost of the loan in the long run.
“Most of us are still going to owe $20,000 to $25,000,” she said, assuming Biden grants some forgiveness. “It’s expensive to be a debtor. You do not want to default or go into a delinquency situation on these loans.”
©2022 Cox Media Group