any people feel trapped by their student loans in one way or another. You might have felt trapped into taking on student debt when you were told you’d “never get a good job without a degree”. For millions of Americans, this promise didn’t work out as intended, and they’re now saddled with student loan debt they can’t repay. President Joe Biden’s campaign included running on a platform of student loan forgiveness. Two years and one pandemic later, we’re all still left with a lot of questions.
Will My Student Loans Really Be Canceled?
First, the biggest question on everyone’s mind: is Biden really going to cancel student loans? The answer is probably not, for one big reason.
Biden’s student loan cancellation plan doesn’t have the backing it needs with other members of the government. Without enough people on board, it can’t happen. Biden could technically sign an executive order, but even with that, long-term plans would need backing in order to stick around.
This isn’t to say that Biden has done nothing to help. During his term, President Biden has canceled student loan debt entirely for some groups of people. People with total and permanent disabilities are on the list, as well as teachers. You can see a complete list here, as well as how to apply.
For the rest of us, just know that discussions are still happening about this. Some members of the Senate support loan forgiveness for up to a certain amount or with conditions like income status. The fate of Biden’s student loan cancellation plan hasn’t been decided yet. Basically, all we can say for sure is that we can’t say for sure. No matter what, it’s best for everyone to be prepared.
But I Haven’t Needed to Make Payments. What’s Going On?
That’s right! You haven’t needed to make any payments since 2020, and interest on your loan hasn’t been accruing. This doesn’t mean your loans have been forgiven, unfortunately.
This temporary student loan freeze started in 2020 as part of the movement to help aid families struggling during COVID-19. It was passed under the Trump administration and then extended twice during the Biden administration.
The point of the freeze is to help families who are unable to make their normal payments due to job loss, illness, or other economic hardships. While it has helped, it definitely wasn’t part of Biden’s student loan cancellation plan.
As things start to go back to “normal”, your normal student loan payments will resume, as well. Interest will start accruing again, and you’ll need to start making arrangements to pay off your loans. Your interest rates haven’t changed and unless you made payments during this time, neither did your balances.
So What Can I do About My Student Loans If I Can’t Make Payments?
Many people struggle with making the “recommended” payments, and many can’t make the required payments, either. If you’re one of these people, you’re not alone. And you’re not out of options.
First, you can apply for an income-driven repayment plan. These can be incredibly helpful for those struggling to make payments on their student loans. You can apply for income-driven repayment here, but it can be time-consuming. The application itself is a long process, and it can take weeks to know whether you’re approved.
You’re also not necessarily approved if you apply. In this case, your best bet will be refinancing. Refinancing sounds scary. No one wants to be taken advantage of by a big bank or a business out to make money at your expense. That’s why we combed through tons of refinancing options and found the top three best companies for refinancing your loans.
Earnest is just the thing for people who feel terrified by the very thought of paying off their student loans. They’re simple and straightforward, and they have a huge blog library, so you can always learn more about your student loans.
When it comes to your refinance, they’ve got options on top of options. You can choose what kind of interest rate your refinancing will have, how big or small your monthly payments will be, and more. They’ll help you every step of the way, so you don’t have to worry about learning a bunch of new terms just to get started.
Maybe the best thing about Earnest, though, is your ability to skip a payment once a year. One payment each year can be skipped and made up for later without affecting your account. This means that when you hit a particularly rough patch, you have a little breathing room.
Education Loan Finance
Education Loan Finance (ELFI) is part of an education-based not-for-profit company that has been working with college students and grads for more than 25 years. They take some of the guesswork out of financing and are a perfect choice for someone who knows what they’re looking for in loan refinancing.
ELFI’s Refinancing Calculator gives you an estimate before you even apply, so you can start your planning right away. When you apply, you won’t have to worry about any application fees, and you have access to their top-rated customer service team anytime.
Out of nearly 1,800 reviews, ELFI has an incredible 4.9 out of 5 stars on Trustpilot. With their stellar review score and years of experience, ELFI just had to make it into the top three.
LendKey also has great reviews, not only on Trustpilot but from sites like NerdWallet and Inuit’s Mint, too. They match small banks and credit unions with borrowers from all over the country. This match-up strategy is a win-win. Not only do you get lower interest rates and better deals with small banks, but the small banks also get more business from you.
Not just with student loans, either! You can also find Home Improvement Loans through LendKey. This makes them a great long-term partner to have in your back pocket. Once you’ve worked with them on one project, you can start on another!
Biden, Student Loans, Cancellation, and You
So, what does all of this have to do with you? Well, debt can have a lot of negative effects on your life. Besides debt impacting your credit score, it can also be a huge source of stress. You’re stressed out about making that next payment or when you’ll finally be paying it off. Student loan debt is a big drain on a budget, too.
Biden’s student loan cancellation plan sounds like a dream. All of those interest rates and monthly payments gone! While it looks like this particular option will stay a dream, your student loan debt should never control your financial future.
When you take concrete steps now, you can rest assured that your student loan debt is on its way out. One way or another, that debt will be gone, and you can move on to your next big adventure. It’s time to take control of your student loan debt, and exploring your options is the first step.