“We all know schooling can change an individual’s means and entry to wealth,” mentioned Gonzalez in a press launch. “Pursuing larger schooling shouldn’t require college students and households to jeopardize their monetary stability or futures. I’m proud to introduce this laws and take this main step to forestall this crushing debt from stifling the American Dream.”
Based on the Division of Schooling, the full excellent federal scholar mortgage debt as of the fourth quarter of 2021 amounted to $1.6 trillion amongst 43.4 million recipients.
Whereas that makes the common scholar mortgage per particular person round $37,000, there are notable gaps between college students who’ve smaller quantities of excellent debt and others who owe considerably extra.
As an example, the Division of Schooling reviews that 7.7 million debtors owed lower than $5,000, whereas one other 900,000 debtors owed greater than $200,000.
Altogether, taking all brackets of debtors that the company lists of their knowledge into consideration, Gonzalez’s $25,000 mortgage cancellation per particular person would value taxpayers $741.8 billion.
The laws is much like a invoice that he filed within the fall of 2020, H.R. 8514, which likewise would have directed the cancellation of $25,000 in federal scholar loans for every recipient.
Below the invoice, the $25,000 cancellation would apply to loans with “the very best relevant fee of curiosity” earlier than being utilized to scholar loans with decrease rates of interest.
Because the pandemic started through the Trump administration, federal scholar mortgage repayments and curiosity have been paused by the Division of Schooling. That pause has continued beneath the Biden administration, with the present pause slated by way of Might 1, 2022.
Gonzalez is at present looking for reelection to the thirty fourth Congressional District, which he was drawn into through the redistricting course of final fall. The district is safer for Democrats than the boundaries of his present district.