Student loan cancellation for 14,000 students in Texas

Another college just canceled student loan debt.

Here’s what you need to know.

Student loans

Dallas College canceled student loan debt for 14,000 students in the past year. The college, which is based in Dallas, Texas, accessed funds from the federal government’s College Emergency Fund, which are stimulus funds in response to the Covid-19 pandemic.

“Clearing the balances will provide much-needed relief to 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 pursue their education and employment goals. It is our responsibility as an institution to do everything in our power to put it on the path to success.

Student Loan Cancellation: More Colleges Cancel Student Loan Debt

Dallas College is not the first college to write off student loan debt for its students. Recently, several schools have taken steps 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 of the classes of 2020 and 2021. This student loan forgiveness came one day after President Joe Biden abandoned the cancellation of student loans in the last federal budget. Last month Delaware State University, a historically black public university, forgave 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 about $3,276 in student debt relief. The state of Delaware also accessed stimulus funds from the U.S. bailout to pay student loan cancellation.

Student loan repayment: an upward trend?

Has the student loan cancellation been canceled? Congress was unable to reach agreement on large-scale student loan forgiveness. Despite several offers of student loan debt forgiveness — including up to $50,000 in student loans — student borrowers wonder if they will get student loan forgiveness. If there is a student loan cancellation, these student borrowers will probably not be eligible, potentially excluding millions of people from large-scale student loan forgiveness. At the same time, there has been an emerging trend of non-governmental actors canceling student loans and helping with student loan repayments.

Colleges cancel student loans

For example, colleges and universities from Dallas College to Wilberforce University have passed student loan forgiveness for college 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 repay your student loans

Yes, your employer can also help you repay your student loans. Congress has created financial incentives for employers to help employees repay their student loans and qualify for favorable tax treatment in exchange. Under the Cares Act — the $2.2 trillion stimulus package — employers can make tax-free payments up to a maximum of $5,250 per employee, including private and federal student loans. Employers and employees save on federal payroll taxes on qualifying payments, while employees save on federal income taxes. This employer student loan relief was scheduled to expire on December 31, 2020, but Congress has extended this student loan relief until December 31, 2025.

Expect colleges and universities as well as private employers to help students and employees repay student loans faster and reduce student debt. The extent of this student loan relief is unknown, but there has been a trend of other actors besides the federal government assisting student borrowers with student loan forgiveness and repayment.

If you have student loans and haven’t gotten your student loan forgiveness from your college, consider these options for repaying your student loans:

Student Loans: Related Reading

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4 ways Biden is enacting student loan forgiveness

Democrats propose canceling student loans with 4 changes

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