Last week, the Department of Education announced changes to two of its student loan programs, the Public Service Loan Forgiveness and income-driven repayment (IDR) programs. These changes will “address historical failures in the administration of the federal student loan program,” as explained in a press release released by the Department of Education. The release states, “at least 3.6 million borrowers move closer to debt forgiveness, 40,000 borrowers to receive immediate forgiveness.” Speaking on this announcement, US Secretary of Education Miguel Cardona explained, “student loans were never meant to be a life sentence, but it’s certainly felt that way for borrowers locked out of debt relief they’re eligible for. Today, the Department of Education will begin to remedy years of administrative failures that effectively denied the promise of loan forgiveness to certain borrowers enrolled in IDR plans.”
This is not the first move by the administration to assist with student loans. Earlier this month, President Biden extended the pause on student loan payments through August 31st, 2022. Biden explained the extension: “If loan payments were to resume on schedule in May, analysis of recent data from the Federal Reserve suggests that millions of student loan borrowers would face significant economic hardship, and delinquencies and defaults could threaten Americans’ financial stability.”
As we have previously noted, tuition is becoming increasingly expensive at top universities. Many top universities are taking the steps necessary to make college tuition more affordable. Williams College recently announced that it will be adopting an “all-grants” financial aid policy, eliminating loans and campus and summer jobs as part of financial aid packages offered to students.
Additionally, The Princeton Review released its lists of best schools for financial aid. According to CNBC, “the average scholarship award is over $57,000” at the five schools atop the private school rankings. Robert Franek, the editor-in-chief of The Princeton Review, explained that “these schools are doing the near impossible, which is bringing the cost down below what a student can expect to pay for one year of public college.” The top five private schools on the list are: Princeton University, Yale University, Pomona College, Vanderbilt University, and Vassar College. The top five public schools for financial aid are: the University of Virginia, University of North Carolina at Chapel Hill, Florida State University, the University of Michigan-Ann Arbor, and City University of New York-Hunter College.