A recent study on the Public Service Loan Forgiveness (PSLF) program from the Student Borrower Protection Center (SBPC) estimated that 9 million public service workers are eligible for relief through the program. Yet, less than 2% of borrowers have witnessed their debts canceled.
SBPC affirmed the reasoning behind those not seeing any relief is that less than 15% of the 9 million borrowers filled out the paperwork to track their PSLF progress. In efforts to inform public service workers like teachers and firefighters about their access to relief, the SBPC has partnered with a union of labor unions like Teamsters and the American Federation of Teachers, representing more than 7.5 million workers, to ensure they enroll in the program.
“At AFT, we have worked tirelessly to deliver on the promise of PSLF debt cancellation, and we are ready to make these new resources available to our over 1.7 million members across the country,” AFT President Randi Weingarten said in a statement, according to Business Insider. “THe relief our members are feeling is palpable. This is not the time to cut corners in getting that relief to as many people as possible, which is why President Biden must extend the waiver and support us in helping members access PSLF.”
President Biden and the education department have been reportedly working to relieve Americans of student loan debt. One method was a limited-time PSLF waiver that aimed to bring 550,000 borrowers closer to relief. The waiver enabled all payments by student borrowers from any federal-loan programs or repayment plans to count towards PSLF, including those who were previously ineligible.
According to an Education Data Initiative report, 48% of Black students owe an average of 12.5% more than they borrowed four years after graduation. For white students, however, 83% of them owe 12% less than they borrowed.
Student loan debt plays a significant role in Blacks financially struggling, with 29% of them making monthly payments of $350 or more.
“The No.1 wealth driver in this country is homeownership, but you can’t qualify for a home if your debt-to-income ratio is too high, and the No. 1 debt for African Americans right now is student loans,” Johnson said. “As a result, there are no paths forward to closing the racial wealth gap without first addressing the student loan crisis in a substantial way.”
President Biden’s student loan forgiveness plan reportedly contributes to fixing the racial wealth disparities. In May, the Biden administration announced that it was considering a student loan forgiveness plan of $10,000 per borrow.
To the NAACP president and CEO, Derrick Johnson, that amount is not enough.
“It’s throwing a bucket of ice on a forest fire,” Johnson told CNBC. “All the data shows the average level of debt for African Americans far exceeds $10,000. Cancellation must be a minimum of $50,000.”