They refuse to pay student loans. Meet the borrowers who are leading a student loan debt strike.
Here’s what you need to know.
Call it a student debt strike. These borrowers are fed up with student loan payments and want President Joe Biden to write off their student loan debt. They blame both the federal government and student loan lenders. So to challenge what they see as a broken system, they just stopped paying student loans. This is what they want:
- Student loan cancellation: Write off all of the $ 1.7 trillion in student loan debt, including private and federal student loans, within the first 100 days of the Biden administration.
- Free college: Make university free
Here are some borrowers and their stories, as featured on Debt Collective website:
Jairo Martinez: “I attended ITT Tech … My debts should be written off because of bad loans that shouldn’t have been approved and a school that is now bankrupt.”
Danielle Adorno: “I am going on strike because the school I attended was not held responsible for its fraudulent practice. I knock so that my son understands when someone hurts you, you have to do what is right and talk. Even though it’s hard and uncomfortable. Cancel student debt!
Pam Hunt. “I am on strike because I went to school for a better job, but I got ripped off. Education must be free. Let’s do this. “
Sanders Fabares: “I went to a for-profit school that grossly distorted its curriculum and then left me with a worthless degree and a mountain of debt. This debt is all the product of a failed system.
Student loan cancellation: what they want
Simply put, these borrowers are asking for their student loan cancellation. Senator Bernie Sanders (I-VT) has proposed the cancellation of student loans of the entire $ 1.7 trillion student debt, including private and federal student loans. However, neither Biden nor the US Senate supports this position. While some in Congress may support the cancellation of all student loan debt, there is no current proposal in Congress for the total cancellation of student loans. Biden wants Congress to immediately write off $ 10,000 in student loans. Senate Majority Leader Chuck Schumer (D-NY) and Senator Elizabeth Warren (D-MA) want $ 50,000 student loan cancellation. First, if there is a student loan cancellation, it is unlikely that, given these two proposals, all student loans will be canceled. Second, the existing proposals include the cancellation of student loans only for federal student loans. So, don’t expect a private student loan cancellation.
Oddly enough, progressives in Congress are not focused on passing legislation to cancel student loans. They want Biden to write off student loans through an executive order. While Biden has signed several decreeshe says he is unlikely to unilaterally cancel student loans. However, at the insistence of Schumer and Warren, Biden considers cancellation of student loan by decree. In the meantime, progressives such as Rep. Alexandria Ocasio-Cortez (D-NY) say Public pressure essential to force Biden to cancel student loans. Likewise, Schumer and Warren tweeted to Biden to write off student loan debt. This strategy can be Bad news for student loan borrowers hoping for student loan cancellation. If Democrats in Congress want student loan cancellation, why not just pass a law? Putting pressure on the president – a fellow Democrat – rather than legislating, won’t do much. This begs the question of whether there is enough support in Congress to pass student loan cancellation. Where Does That Leave Student Loan Borrowers?
Should we stop paying student loans?
No, you shouldn’t just stop paying student loans. First, if you stop paying your student loans, interest will continue to accumulate, which can increase your student loan balance. Second, your salary, income tax refund, or Social Security benefits may be garnished. Third, your credit score can drop dramatically. Currently, Biden break in federal student loan payments for eight months until September 30, 2021. During this period, you are not required to make student loan payments for federal student loans held by the US Department of Education. Borrowers who participate in the collective student loan debt strike say they are in default, enrolled in an income-based repayment plan, or have opted out or deferred on their student loans.
While these options are available to federal student loan borrowers, they are different from refusing to repay student loans. Rather, they are federal benefits offered to student loan borrowers to provide them with student loan relief. That said, if you’re having trouble paying off your student loans, don’t just stop paying. Contact your student loan manager to find out about all of your options. Some borrowers listed on Debt Collective’s website say they attended for-profit colleges and were victims of fraud or school closures. If these borrowers hold federal student loans, they can contact the US Department of Education and request the potential cancellation of their student loan based on their unique requests.
Will your student loans be canceled?
Will your student loans be canceled? Currently, Democrats in Congress do not have a universal plan for canceling student loans. Biden proposed three ways to cancel student loans. That said, there is disagreement over the amount of student loan cancellation, who qualifies, and how student loans are canceled. The current strategy appears to be based on pressuring the president to cancel student loans, although at best it is not legally clear whether the president has such unilateral authority. If student loan cancellation is the goal, Congress seems disorganized to achieve its apparent goal. What does this mean for your student loans? Understand that you may not get any student loan cancellations now or in the future. If you do, not everyone may be eligible for a student loan forgiveness. Rather than just hoping for student loan cancellation, be sure to develop a student loan game plan. Start with these three options, all free: