Loan Forgiveness Bills Would Mostly Impact Borrowers in California, Texas

Student loan borrowers in California and Texas would immensely benefit from the two loan forgiveness plans proposed by Senators Bernie Sander and Elizabeth Warren if each of them is enacted.

A new FinanceBuzz analysis of income data from the U.S. Census Bureau and student loan data from the U.S. Department of Education compiled two separate lists of states that would witness a huge debt relief if the bills receive presidential assent.

In June, Sanders had introduced a bill that would completely eliminate student debt by imposing a tax on Wall Street and make two and four-year public and tribal colleges and universities tuition-free and debt-free.

Warren’s bicameral Student Loan Debt Relief Act will forgive loans of up to $50,000 for those whose household gross income is less than $100,000 by using already available data on household gross income and pending student loan debt.

Both the senators are also running for the 2020 presidential election.

If Sanders proposed legislation is enacted, the state of California with 3.4 million borrowers carrying a total of $116 billion in federal student loan debt will benefit the most, followed by Texas and New York which collectively have nearly $5.1 million borrowers.

However, if Warren’s debt relief act is passed, the state of Texas with 2.9 million student loan borrowers having an average debt of $29,911 will benefit the most. The states of Florida and Texas with 2.2 million and 3.4 million student borrowers respectively carrying less than $50k will also benefit if the legislation is implemented.

A recent survey found Sanders plan immensely popular American adults, as nearly 40 percent of them backed him when it comes to selecting a Democratic presidential candidate during their state’s primary to address their concerns of student loan debt.

Most Economists Not in Favor of Forgiving Student Loans [Survey]