What President Biden’s Loan Forgiveness Could Mean For Law Grads
During his run for presidency, President Biden called for forgiving $10,000 of federal student loan debt per person.
While those calls haven’t yet entirely been placed into action, the reality of forgiving student loan debt could be life-changing for many – especially law school grads. On average, law school students graduate with student loan debt of $145,550, according to NerdWallet.
Stephanie Francis Ward, of the ABA Journal, recently discussed what loan forgiveness could mean for law school debt if President Biden follows through on his word.
THE FINE PRINT
While forgiving student loan debt could be life-changing for many, Ward says that not all types of debt would be forgiven.
“People with law school loans could benefit if President Joe Biden authorizes a plan to forgive all or a portion of student debt, but it could exclude those who owe private lenders and impose limits based on income,” Ward writes.
Realistically, experts say, loan forgiveness would be needs-based with consideration of income.
“The Student Loan Debt Relief Act, a 2019 bill sponsored Sen. Elizabeth Warren, a Massachusetts Democrat, suggests canceling up to $50,000 for borrowers with adjusted gross income of no more than $100,000,” Ward writes. “Borrowers with gross incomes above the number could receive partial loan cancellation.”
THE WEIGHT OF DEBT
Student debt can take years to pay off.
But the consequences of debt can reach far beyond financial harm. According to a survey by the ABA’s Young Lawyers Division, most lawyers report that their loans contributed to mental health issues.
The Young Lawyers Division is currently calling for amending the U.S. bankruptcy code to discharge student loans. Aaron Sohaski, a Detroit lawyer who serves as director of student debt and financial wellness for the division, says the mental health study plays an important role in advocating on student loan reform.
We believe it will further bolster our argument on why there should be reform in this space, and why we should be zealous advocates for our members,” Sohaski tells the ABA Journal.