Here's what Biden's student loan relief plan means for Louisiana borrowers
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Hundreds of thousands of Louisiana borrowers are eligible to have a portion of their student loan debt wiped out under a plan announced Wednesday by President Joe Biden.
Biden’s plan will cancel up to $10,000 in student debt for most borrowers and up to $20,000 for those who received Pell Grants, which are awarded to students who have shown exceptional financial need.
More than 650,000 Louisiana residents are carrying a combined $22.5 billion in student loan debt, according to Education Data Initiative research, though not all of those will qualify for the program.
Biden’s plan covers only federal student loans, not private ones, and is limited to individual borrowers with incomes less than $125,000 or household incomes of less than $250,000.
He also extended a moratorium on federal student loan payments that was implemented during the coronavirus pandemic “one final time” through Dec. 31, 2022. Monthly payments will be capped at 5% of monthly income for undergraduate loans.
“In keeping with my campaign promise, my administration is announcing a plan to give working and middle class families breathing room as they prepare to resume federal student loan payments in January 2023,” Biden said in a tweet.
More than 43 million people have federal student loan debt in the U.S. with the average borrower carrying about $37,000 in debt.
Louisiana's average debt is less at $34,500 per student borrower, but the state’s population has a higher proportion of borrowers at 14%, according to Education Data Initiative.
Biden’s plan was met with blistering criticism from Louisiana’s Republican congressional delegation, which includes all but lone Democratic Congressman Troy Carter of New Orleans, who praised the debt relief.
“President Biden is attempting to buy votes in the light of day,” Republican Congressman Mike Johnson of Benton tweeted. “But it won’t work because most Americans see this for what it is: an illegal wealth transfer from the working class to the elites.”
Carter said Biden’s debt relief is welcome, but he continues to advocate for the $50,000 in forgiveness favored by the Legislative Black Caucus, NAACP and others.
“As an advocate for my constituents and for student loan forgiveness, this is a great day, but we still need to do more,” Carter said in a statement. “Congress must build on the president’s action today and pass legislation such as my Student Loan Relief Act of 2021 so that every American can pursue their dreams.”
A USA TODAY/Public Agenda poll in July found that nearly 60% of Americans support “forgiving a significant portion of government student loans for college graduates who have excessive debt.” That rate of support dropped when Americans were asked about forgiving debt for all graduates, regardless of income.
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"There's no question that student loan debt has become an increasingly onerous burden for many," University of Louisiana System President Jim Henderson told USA Today Network. "The big question is what's the best way to approach addressing the problem."
Following are key Louisiana findings from the Education Data Initiative's latest report:
► $22.5 billion in student loan debt belongs to state residents.
► $34,525 is the average student loan debt.
► 651,700 student borrowers live in Louisiana.
► 52.8% of them are under the age of 35.
► 14.0% of state residents have student loan debt.
► Among the state’s indebted student borrowers, 17.1% owe less than $5,000.
► 19.8% owe $20,000 to $40,000 (average $28,571).
► 1.9% owe more than $200,000.
Greg Hilburn covers Louisiana politics for the USA Today Network. Follow him on Twitter @GregHilburn1.
This article originally appeared on Lafayette Daily Advertiser: Here's who's eligible in Louisiana for student loan relief in Biden plan
