Borrowers’ reactions to President Biden’s student loan forgiveness program run the gamut — some people are breathing a huge sigh of relief, while others feel the program doesn’t go far enough to account for the skyrocketing cost of higher education.
Reset heard from Chicagoans who are having some of their debt forgiven to hear their reactions to the program.
“I can get to the other side”
For Eman Abdelhadi, the recently-announced student loan forgiveness provides a glimpse of light at the end of a tunnel of debt.
Abdelhadi, a sociologist and assistant professor at the University of Chicago, took out loans to attend college at the University of Michigan. She also received Pell Grants — a scholarship available to students from low-income backgrounds. By the time she graduated, Abdelhadi had accumulated $50,000 of debt.
“I considered myself lucky to have that little, which tells you a lot about the state of higher education in this country,” Abdelhadi said.
Her student loan debt was a major impediment to accumulating wealth for Abdelhadi.
“Unless you have a parent who can give you a down payment or some type of inheritance, it’s really, really hard to move up or to buy property,” Abdelhadi said.
With student loan forgiveness, Abdelhadi’s debt could be reduced to $30,000. That would allow enough room in her monthly budget to save toward a down payment on a house.
“It’s a significant amount. If I scrounge, or pick up an extra class, I can get to the other side,” Abdelhadi said.
But while the student loan forgiveness program frees up space in Abdelhadi’s monthly budget, she said a wide-scale shift would have required canceling even more student debt.
“It feels like I’m making real progress”
Kat Murphy left her full-time job in higher education admissions during the pandemic to take care of her newborn daughter, who had health issues. Murphy was confident she made the right move, but quitting her job also meant she no longer qualified for Public Service Loan Forgiveness — a program that erases remaining student loans after 10 years of payments for people who work in public service.
Murphy was staring down years of payments for the $30,000 in loans she took on to pursue her master’s degree at a private university.
When Murphy found out President Biden was forgiving student debt for some borrowers, she said she was absolutely elated.
“My husband called me and said, ‘Biden did it! He did it. He’s canceling $10,000 of debt,’” Murphy said.
Murphy said she’ll be able to pay off her loans in less than two years.
“With this $10,000 loan forgiveness, the finish line is in sight,” she said.
But Murphy said this doesn’t just benefit her alone; This program also lightens the load for professions that benefit society, like doctors and nurses, and paves the way for future generations.
“I don’t want my daughter in 20 years to take on $100,000 worth of debt,” she said.
GUESTS: Eman Abdelhadi, assistant professor of comparative human development at University of Chicago; sociologist studying gender and Muslims in the U.S.
Kat Murphy, recipient of debt forgiveness, works in higher education admissions