How many student loan borrowers are there? Details explored as Biden administration cancels loans worth $5.8 billion+

If your loans are forgiven, canceled, or discharged, you are no longer required to repay some or all of them. On Wednesday, the US Department of Education announced that it had canceled $5.8 billion in outstanding student loans for more than 560,000 students, making it the government's largest single debt forgiveness action.

The cancellation impacted all students who attended schools run by the now-defunct Corinthian Colleges, one of the largest for-profit education businesses that filed for Chapter 11 bankruptcy in 2015.

The announcement comes as the Biden administration explores expanding student debt forgiveness to millions of borrowers – the government has already approved $25 billion in loan forgiveness for roughly 1.3 million borrowers.

While some politicians and economists applauded the action as a step toward tackling the $1.7 trillion student debt crisis, millions of borrowers have yet to receive relief and question if their loans will be erased.

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Biden Administration cancels $5.8 million student loans: Details explored

Biden has forgiven the most number of student loans among all the Presidents who have taken office. While the president has concentrated on targeting student loan forgiveness, student loan holders have yet to receive widespread relief.

Officials at the White House are considering canceling $10,000 in student loans for all students earning less than $150,000 per year, but the administration has yet to confirm such plans.

However, during his speech, the president made no mention of student loan relief. Student loan borrowers are now wondering if the president will utilize his authority to cancel student debts for the majority, if not all, of the borrowers.

According to the College Board, average tuition rates more than doubled between 1991-92 and 2021-22, rising to $10,740 from $4,160 at public four-year colleges and $38,070 from $19,360 at private universities after accounting for inflation.

Wages haven't kept up, according to higher education analyst Mark Kantrowitz.

“Household income has been stagnant,”

According to Emily Cook, the change to "high-tuition, high-aid" resulted in a "huge overall volume of debt." A growing proportion of students believe they must attend graduate school to compete in the job market.

However, more time in school often means more expenses and a higher need for borrowing. After graduation, around 40% of outstanding federal student debt is currently taken on for masters and Ph.D. degrees.

In 2018-19, average parent student loan levels were over $35,000, up from roughly $5,000 in the early 1990s. Meanwhile, the private student loan industry has expanded by more than 70% during the last decade.

Hundreds of thousands of new students enter the system every year while current borrowers battle to get their loans forgiven.

According to Kantrowitz, many recent college graduates cannot afford to repay their loans over 10 years. As a result, according to data from the US Department of Colleges, it takes an average of 17 years for Americans to pay off their education debt.

Since the 1990s, the average load at graduation has tripled, from $10,000 to $30,000. Around 7% of student loan debtors are already in debt for more than $100,000.

It is forecasted that outstanding student loan debt might reach $3 trillion in the next two decades if no action is taken.