Biden forgives $10,000 in school loans for many people.

Millions of Americans who make less than $125,000 annually will get up to $10,000 (£8,474) in federal student loan cancellations from US President Joe Biden.

Additionally, Mr. Biden will waive $20,000 in debt for Pell Grant recipients, who are those with the greatest need.

At 14:15 EST, the president will lay out the specifics of his strategy (18:15 GMT).

Federal student debt is owed by 43 million Americans, who collectively owe $1.6 trillion.

The majority of people owing less than $10,000.

In order to offer working and middle-class families some breathing room as they get ready to start making federal student loan payments again in January 2023, Mr. Biden said on Twitter on behalf of his government.

A final extension will be made to the temporary student loan suspension, which was first implemented in March 2020, through the end of this year.

The statement comes after an extended period of heated internal debate within the White House and increasing pressure from progressive Democrats. Senators Elizabeth Warren of Massachusetts and Chuck Schumer of New York, both prominent Democrats, were among those who urged Mr. Biden to utilize his unilateral authority to cancel borrower loans.

The $50,000 per borrower plan that Mr. Schumer and Ms. Warren requested is less than Wednesday's proposal.

According to an estimate from the Penn Wharton budget model at the University of Pennsylvania, a one-time cancellation of $10,000 for each borrower earning a maximum of $125,000 will cost the federal government about $300 billion.

Inflation will increase as a result of debt elimination, according to Republicans and some moderate Democrats. Others contend that a generalized debt forgiveness program is unjust to borrowers who have already repaid their school debts.

Californian Republican and House Minority Leader Kevin McCarthy immediately criticized the proposal on Twitter, asking: "Who will foot the bill for Biden's debt transfer scam? Americans with a good work ethic who have previously paid off their bills or who have never had student loan debt, he wrote.

Democratic legislators objected, arguing that eliminating student loans would help reduce economic inequalities across races.

Compared to other Americans, black students are more likely to borrow federal student loans and at higher rates. According to a Brookings Institution study, black borrowers owe, on average, over $25,000 more than their white counterparts four years after receiving bachelor's degrees.

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