By Kathryn Watson, Allison Elyse Gualtieri, Nancy Cordes, Updated on: August 24, 2022 / 12:16 PM CBS News
Washington — President Biden announced Wednesday he is forgiving up to $10,000 in federal student loan debt for millions of Americans and an additional $10,000 for low-income borrowers while extending a pause on monthly payments, delivering long-awaited relief just weeks before the midterm elections.
Under the plan, which the president unveiled on Twitter, borrowers earning less than $125,000 a year, or couples earning less than $250,000 a year, would be eligible for up to $10,000 in loan forgiveness. Recipients of Pell Grants, which are given to students with the greatest financial need, would be eligible for another $10,000 in relief. Loan payments will also be capped at 5% of monthly income. Current students will be eligible for debt relief as well, although future students will not be, according to senior administration officials who explained the details of the plan to reporters on a call.