President Joe Biden (Photo by Erin Scott-Pool/Getty Images)
Surprise, this college just cancelled student loans for all its new graduates.
Here’s what you need to know.
Student Loans
Student loan cancellation for all graduates
Wilberforce University, America’s oldest private historically black university, surprised its graduates yesterday with the ultimate graduation gift: student loan cancellation. This student loan forgiveness comes one day after President Joe Biden dropped student loan cancellation from the latest budget. At the end of the university’s commencement, Wilberforce President Dr. Elfred Anthony Pinkard announced that the university will cancel all student loan debt and fines owed to the school from the classes of both 2020 and 2021.
“As these graduates begin their lives as responsible adults, we are honored to be able to give them a fresh start by relieving their student debt to the university,” Pinkard said. The total student loan debt relief is approximately $375,000, and has been provided through financial support from the United Negro College Fund, Inc., Jack and Jill, Inc., and other institutional funding. Wilberforce also accessed emergency financial aid for colleges and universities through the Cares Act, the $2.2 trillion stimulus package that Congress passed last year. According to the university, funds from the Cares Act helped students financially who otherwise would have been unable to enroll for fall classes.
Student loan cancellation
Student loan cancellation and Covid-19 pandemic
Wilberforce is not the only university to cancel student loans for its graduates this year. For example, earlier this month, Delaware State University, a public historically black university, cancelled up to $730,655 in student loan debt for more than 220 recent graduates faced financial hardship during the Covid-19 pandemic. On average, eligible student loans received approximately $3,276 in student loan debt relief. “Our students don’t just come here for a quality college experience,” Delaware State President Tony Allen said. “Most are trying to change the economic trajectory of their lives for themselves, their families, and their communities. Our responsibility is to do everything we can to put them on the path.” Delaware State is using funds from the American Rescue Plan stimulus package to pay for student loan cancellation.
Biden: Cancel student loans at these colleges
Biden wants student loan cancellation three ways. (That said, the latest stimulus package, infrastructure package and budget don’t include any student loan cancellation). One of those ways is to enact student loan cancellation at Historically Black Colleges and Universities (HBCU’s) as well as four year public colleges and universities. Under Biden’s plan, college tuition would be free for students who families earn less than $125,000 annually. Biden also wants student loan cancellation for student loan borrowers who attend these colleges and unversities and earn less than $125,000 annually. Like wide-scale student loan cancellation, Biden is calling on Congress to pass legislation to cancel student loan debt at these colleges and univerisites and make them tuition-free. While Biden is unlikely to issue an executive order, Sen. Bernie Sanders (I-VT) already has proposed the largest student loan cancellation and free college plan in U.S. history. Senate Democrats also proposed four ways to change student loan forgiveness. Wilberforce and Delaware State are only two examples of colleges and universities that are cancelling student loans for their students. Will more colleges and universities cancel student loan debt for their students?
In the meantime, if you have student loans, make sure you have a solid plan for student loan repayment. Here are some potential options to consider:
