Education debt in the U.S. has eclipsed credit card and auto debt. Today the average college graduate leaves school $30,000 in the red, up from $10,000 in the 1990s, and 28% of student loan borrowers are in delinquency or default.
Under Warren's proposal, introduced along with Rep. James E. Clyburn, D-S.C., borrowers with household incomes under $100,000 would get $50,000 of their student debt forgiven. People who earn between $100,000 and $250,000 would be eligible for forgiveness on a sliding scale – the cancellation amount reduces by $1 for every $3 a person earns over $100,000. And those who earn more than $250,000 would not get any debt relief.
The degree of debt forgiveness a person receives would be determined by their income in the most recent tax year. The loan cancellations would take about a year from the time the bill is enacted to complete. No paperwork will be required as the cancellations would be carried out automatically through information sharing between the Treasury Department, the Internal Revenue Service and the Department of Education.
If a borrower has multiple loans, the Department of Education will void the loan with either the highest interest rate or outstanding balance.Any forgiven debt would not be considered taxable income. Those with private student loans would be given the option to convert them into federal loans.
CNBC What about all students?
CNBC ewarren The people who have the large debts chose to run them up. They wanted to brag about their private schools, ivy league schools, or out of state schools. Let them pay for it. I chose community college and a state school so I could afford it.
CNBC What’s the word for this idea? Oh, right - pandering.
CNBC America's entire education system needs a complete overhaul. From the very bottom to the very top. It should be free or subsidized though the doctorate level if students are qualified. Americans are being left behind the world in education. Better career choices for students.
CNBC If this passes, I expect to receive the amount I would have borrowed, but didn't because I knew it was too expensive. I also expect interest on that amount, and I'd like to have reparations paid to me because I was deprived of a great paying job because I didn't have a degree.
CNBC So...colleges have gotten rich through unsustainable tuition increases, and now wealthy taxpayers are supposed to make up for it? It would also be inconceivably difficult to administer in a fair way. Better start printing the avalanche of forms and applications now!
CNBC Single handily trying to throw this country in to economic turmoil.
CNBC Not economically viable.
CNBC You mean pass on everybody student loan debt to the taxpayer? The debt doesn't go away the person paying the debt changes
CNBC I guess these Universities failed to teach tomorrow’s leaders anything about personal responsibility. Bribery2020
CNBC Damn it I'm so mad I paid off my student loans. Grrrrrrrrr
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CNBC I don’t agree with this
CNBC Give me money for enduring 8 failed years of Obama.
CNBC On behalf of ALL The responsible borrows who repaid their student loans or borrowed responsibly.... I would like to express my total disgust for these desparate politicians selling our country down the drain for 25% of the tax payers....HOW DARE HER
CNBC Please help me on my student loan, Senator /President?
CNBC ewarren SenWarren Any student debt forgiven needs to be coupled with a mandate the Education institutions must reimburse the gov't all tuition & fees collected
CNBC Nothing is free
CNBC So she’s taking our money to pay their loans
CNBC So what happens to education loans going forward? Does it just start all over again?
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CNBC And what do the others (taxpayers) get? Create a bill, pay the bill. If I wanted to pay for others education I would start my own scholarship program.
CNBC what this really is, is that pocahontas just came up with a plan to get a million more votes....!!!
CNBC Unless ewarren's bill includes a provision to refund all the college funds I paid out of pocket her bill is discriminatory. She can't make college virtually free for just some of us when it was paid for with federal funds.
CNBC Every student loan should be forgiven even student loans in the past.
CNBC What about people that didn’t go to collage but could really use some of that money. I went to the military instead of collage. Think I deserve money over some kids that just made bad money choices. They all could have gone to service and got school for free. Just saying.
CNBC Hell no. Republicans much rather give that money to millionaires as a Tax Cuts then giving to needy Americans
CNBC Pandering at its finest
CNBC Who’s agreed to give away all that money?
CNBC I want my mortgage reset to ZERO!
CNBC I'll vote for her if she pays off my truck. Thats how this works, right?
CNBC So the tax payers are on the hook?
CNBC Not fair to the ones who struggled to pay theirs, is it?
CNBC Is it going to be retroactive? If not, fuck it.
CNBC Is it fair for those going to colleges on their own tight budgets without borrowing money?
CNBC Makes me feel like a fool for working hard, sacrificing desires until my agreed upon debt was paid off! Pandering!
BGlasgow37 CNBC If one takes out a loan at least part should be repaid.
CNBC Wow how is she gonna pay for this...
CNBC We spent 6 trillion fighting 2 wars in the middle east with little to nothing to show for it. At least with this some Americans will actually see some benefit
CNBC I’ll believe it when I see it, but how about tackle the real problem. Increase guidance in high schools and lower the price of a college education. I’m 80k in student debt myself, I’ve never afforded to pay it back, and am currently not even using my degree due to low high rates.
CNBC Does anyone know what would happen to asset backed securities that are backed by student loans. Would those pay down or default.
CNBC They will be the ones to laugh at her 😆😆
CNBC If I could vote now I would