Suncoast colleges and universities respond to President Biden’s student debt relief plan

ABC7 News at 6pm
Published: Aug. 25, 2022 at 8:29 PM EDT
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BRADENTON, Fla. (WWSB) - President Biden announced a plan for student debt relief that will affect millions of Americans when it comes to reducing their student loans.

The student debt relief plan will grant up to $20,000 for students with a Pell Grant and up to $10,000 for those without the grant. The three-part plan started with the extension of the student loan repayment pause until Dec. 31. 2022. Part two starts with the targeted debt relief for low and middle-income families. Finally. income-based repayment will be added to make the student loan system easier.

University of South Florida economics instructor Michael Snipes said students will still have to pay back a significant amount of debt.

“For example, I owe $60,000 in debt and if my debt gets reduced by $10,000, well, now I still owe $50,000,” said Spines. “It’s not like they are getting rid of all the debt and so this is just a way to kind of alleviate the burden just a little bit.”

State College of Florida and Hillsborough Community College South Shore campus are not experiencing an increase of calls and questions from students about the plan. According to the associate vice president of communications for SCF, Jamie Smith, the college is affordable enough for students to leave debt-free.

Smith said many of those students move on to other schools to get higher-level degrees where they can acquire debt.

“Depending on where they go they may incur a lot of debt,” said Smith. “We feel for them and we’re hoping that whatever this provision provides or does for students, they can take advantage of it and we hope it’s just the start.”

According to Spines, another argument being made is that the plan with affect the economy. Financial Investors buy student and credit card debt from the bank and the student debt relief plan would hurt their revenue said Spines.

“I mean it could affect the economy but the financial sector is full of smart individuals who are going to take care of their money,” said Spines.

According to Spines, the major problems are the cost of education and students’ lack of knowledge about debt. It’s not reasonable to expect 18-year-olds to rack up debt without real-world experience in how the financial sector works said Spines.

“Is it really fair to saddle somebody who doesn’t even know what they are getting into, is it really fair to saddle them with that debt before they really know what’s going on,” said Spines.

More information will be sent out by the Biden administration in the next few weeks on the next steps in the student loan relief plan.