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Student loan forgiveness: Biden to continue freeze of payments, ask Congress to erase debt

President-elect Joe Biden's administration plans to continue a pause on federal student loan payments when he takes office this month, according to officials helping with the transition.

The nation’s tens of millions of student loan borrowers could continue to abstain from making payments, though it wasn't immediately clear how long the pause would last.  

Biden officials also said Friday they would encourage Congress to pass legislation to erase $10,000 in federal student loan debt per person. That move, however, is likely to draw criticism from activists who have pushed Biden to forgive more debt per person, in some cases up to $50,000, via executive action upon taking office.

In the early days of the coronavirus pandemic, President Donald Trump's administration suspended student loan payments, froze interest and told loan servicers to stop their collection efforts. That pause recently was extended by outgoing Education Secretary Betsy DeVos through the end of January. 

"On day one, the President-elect will direct the Department of Education to extend the existing pause on student loan payments and interest for millions of Americans with federal student loans," said David Kamin, the incoming deputy director of the National Economic Council and recently a professor at New York University's law school.

Wiping out federal student loan debt is more controversial. Critics of student loan forgiveness, who include both liberals and conservatives, have said wiping out these debts would unfairly benefit those with a college education, who typically earn more as a result.

According to Federal Reserve data, Americans hold about $1.7 trillion in student loan debt. Student borrowers who graduated in 2019 from public or private nonprofit colleges held on average $28,950 in debt, according to The Institute for College Access and Success.