Another college just canceled student loan debt.
This is what you need to know.
Dallas College canceled student loan debt for 14,000 students last year. The university, which is based in Dallas, Texas, accessed funds from the federal government’s Emergency Fund for Universities, which are stimulus funds in response to the Covid-19 pandemic.
“Cleaning up the balance sheets will provide much-needed relief for many of our students,” said Dr. Marisa Pierce, Assistant Vice Chancellor, Enrollment Management, Dallas College. “We hope that by removing this barrier we will allow them to achieve their educational and employment goals. It is our responsibility as an institution to do everything possible to guide it towards success ”.
Student loan cancellation: more colleges are canceling student loan debt
Dallas College is not the first university to write off student loan debt for its students. Recently, several schools have acted to cancel student loans. For example, Wilberforce University, America’s oldest historically black private university, canceled all student loan debt and fines owed to the school for the classes of 2020 and 2021. This student loan forgiveness occurred One day after President Joe Biden removed the cancellation of student loans from the latest federal budget. Last month, Delaware State University, a historically black public university, wrote off up to $ 730,655 in student loan debt for more than 220 recent graduates who faced financial difficulties during the Covid-19 pandemic. On average, students got approximately $ 3,276 in student loan debt relief. The state of Delaware also accessed funds from the American Rescue Plan stimulus package to pay for the cancellation of student loans.
Student Loan Forgiveness: Upward Trend?
Was the cancellation of the student loan canceled? Congress has been unable to reach an agreement on large-scale student loan forgiveness. Despite multiple proposals to write off student loan debt, including up to $ 50,000 in student loans, student loan borrowers wonder if they will get student loan forgiveness. If there is a student loan cancellation, these student loan borrowers will likely not qualify, which could exclude millions of people from large-scale student loan cancellation. At the same time, there has been an emerging trend of non-governmental actors paying off student loans and helping with the repayment of them.
Colleges cancel student loans
For example, colleges and universities from Dallas College to Wilberforce University have approved the cancellation of student loans for students. As noted, several colleges and universities have canceled student loans with funds from the latest stimulus package in response to the Covid-19 pandemic.
Your employer can pay off your student loans
Yes, your employer can also help you pay off your student loans. Congress created financial incentives for employers to help employees pay off their student loans and obtain favorable tax treatment in return. Under the Cares Act, the $ 2.2 trillion stimulus package, employers can make tax-free payments of up to $ 5,250 per employee, including private and federal student loans. Employers and employees save on federal payroll taxes on qualified pay, while employees save on federal income taxes. This employer student loan exemption was scheduled to expire on December 31, 2020, but Congress extended this student loan exemption until December 31, 2025.
Expect colleges and universities, as well as private employers, to help students and employees pay off student loans faster and reduce student loan debt. The magnitude of such student loan relief is unknown, but there has been a trend for actors other than the federal government to help student loan borrowers with student loan forgiveness and student loan repayments.
If you have student loans and did not get the student loan discharged from your college, consider these options for paying off student loans: