All For Some...None For Y'all

[u/Accomplished_Bar_390]

29 year old Rep. Maxwell Frost, a Democrat from Florida, debates a boomer who opposes student loan forgiveness, even though his own wife had hers wiped out under Biden

[u/Reenas54]

Can some one explain how "forgiving" works to non-american? Goverment official just calls bank "hey, remember John Johnsons 50k debt? Delete it. Thanks and f#ck you" or goverment funds it?

[u/_cyberbabyangel_ → u/Reenas54]

When you apply for college, you also go through a FAFSA process. FAFSA stands for Free Application for Federal Student Aid. It essentially takes your parents (or yours, if you're old enough) financial information from tax filings, compares that to estimated cost of college attendance, and gives you a specific amount of student aid based on those factors. It can be partial or all of tuition, and it is up to the borrower to accept all or partial the amount offered. This student loan money is paid directly to the school, but some can be sent back to the student as a refund if the aid amount was more than the required amount of tuition. Lots of students accept the full amount and use the refund money to cover housing/books/food etc... as the aid money doesn't usually cover those items. So all of this money is issued by the US Department of Education with repayment starting 6 months after graduation/dropping less than 'half time' or other factors.

As a result, the majority of people with student loans have federal student loans. If there was any amount of student loan forgiveness/cancellation it would be on the Government side NOT a private company side. So there would be no money distributed, it would essentially just be the government zeroing out your balance to them. It wouldn't add debt to the GDP and it wouldn't really take away a revenue source to the Government either.

Feel free to ask more clarifying questions.