MAINE, USA — As word of President Biden's plan to relieve student loan debt for millions of Americans and roughly 177,000 Mainers continues to spread, many are saying there seems to be more questions than answers.
The president announced people who attended a college or university will receive $10,000 in federal loan relief if they make less than $125,000 a year. For those who received Pell Grants while in college, up to $20,000 in federal student loan dollars will be forgiven.
Stephanie Owen, assistant professor of economics at Colby College, says the addition of more relief for Pell Grant recipients makes the policy more racially progressive.
"Black Americans and Americans of color are more likely to receive Pell Grants," Owen said.
The plan also comes with a final extension for paying back loans. Borrowers now have through the end of this year before monthly loan payments resume.
But this announcement is setting off mixed reactions about what is actually being solved.
"Big picture — just forgiving debt now for millions of Americans is not addressing the underlying issue," Owen said.
Connie Smith is the director of financial aid at the University of Maine.
"I do think it's a bit of a band-aid," Smith said.
Smith says phones in the financial aid office have been ringing off the hook since the news of the loan forgiveness plan broke Wednesday afternoon. She says while she's happy it will help students struggling to pay off debt, she's wondering what will be done to address the larger issue of college affordability.
"My hope is that after we get through this particular phase that there's a lot of work done around maybe reconstructing the loan programs," Smith said.
A redesigned repayment plan was also announced by President Biden on Wednesday. The new plan caps monthly payments at five percent of an individual's monthly income.
This news, coming as a sigh of relief for recent college graduates like Chantal Ouellette.
"Personally, I'm very excited about it," Ouellette said.
Suspended loan payments aside, Ouellette says she struggled to find an affordable place to live in Portland on her roughly $30,000 income.
"Inflation and housing right now... the apartment I have was well beyond what I had been hoping for rent," Ouellette said.
The White House is expected to face lawsuits over the proposed plan, so there is no word yet on when borrowers might start seeing this relief.