Story at a glance:
- About one-third of students who are in debt have stopped repaying their loans.
- More than half of borrowers said they changed their spending habits due to COVID-19.
- About 45 percent of Americans believe President Biden will make good on his promise on forgiving $10K.
In response to the pandemic, 35 percent of students who are in debt have stopped repaying their loans.
In January 2021, President Biden used an executive order to extend the federal student loan payment freeze for an additional eight months, giving students more time to resume their payment at least by September.
America is changing faster than ever! Add Changing America to your Facebook or Twitter feed to stay on top of the news.
However, with talks of as much as $50,000 of student loan debt per person possibly being forgiven under President Biden, the spending habits of borrowers has changed, and they are now reliant on uncertain premises, College Finance reported.
The firm surveyed 1,000 people about their approach to student loans over the past year, and 58 percent said they changed their student loan repayment habits due to COVID-19.
In addition to people stopping paying their loans, about 65 percent have lowered their payment.
Fifty-nine percent of students are paying their loans during the interest freeze.
The most common outstanding debt is $25,000 or less, followed by $26,000 to $50,000, with debt more than $51,000 being rare.
A person’s student loan debt influences their ability to make certain personal and financial choices, whether it is career-oriented or leisure. This leads to 56 percent of students saying they developed mental health issues because of their student loans.
“Among those surveyed, 45% said their student loans have prevented them from buying a house, followed by those who said they were unable to take vacations (42%), buy a new car (35%), or pay more than the minimum on their credit card balances (28%),” College Finance reported.
Biden promised to forgive $10,000 of people’s loans with poll results showing about 44.8 percent of Americans believing he will make good on his promise, 31.8 percent believing he will not and the remaining 23.4 saying they are unsure.
Regardless if Biden forgives student loans or not, 74 percent of Americans think it is the government’s responsibility to forgive loans, including 82 percent of those respondents earning less than $30,000 annually and 77 percent of those earning between $31,000 and $60,000.
READ MORE STORIES FROM CHANGING AMERICA
TV STARS CHIP AND JOANNA GAINES DONATE TO CAMPAIGN AGAINST CRITICAL RACE THEORY IN SCHOOLS
BIDEN STILL CONSIDERING CANCELLATION OF AS MUCH AS $50K PER PERSON IN STUDENT DEBT
US SECRETARY OF EDUCATION CANCELS $1B OF STUDENT LOAN DEBT
ACCORDING TO CDC, 96 PERCENT OF SCHOOLCHILDREN STILL UNSAFE FOR FULL-TIME, IN-PERSON LEARNING
COLLEGE STUDENTS ARE REEVALUATING THEIR PLANS IN A POST-COVID WORLD
Published on Jun 23,2021