WASHINGTON — From $10,000 to upwards of $100,000 residents of D.C., Maryland and Virginia are no stranger to student loan debt. Many new graduates, however, have yet to start paying back their loans, thanks in part to a repayment pause put into effect during the COVID-19 pandemic.
"I have about $20,000 in debt," said Sarah Hawrami, a D.C. resident and 2019 University of Tennessee graduate. "There's been a pause on payments and then during COVID I didn't have a job, but I still have the majority of the debt."
Come next week, that relief may end as the Biden Administration's pause expires on Aug. 31. However, the president may be leaning toward a plan to cancel up to $10,000 in student loan debt with the actual amount forgiven tied to your salary, according to CNN.
Of the $1.75 trillion in student loan debt, which impacts approximately 48 million Americans, D.C. tops the list of debt by state, according to EducationData.org, with Maryland and Virginia right behind.
In fact, the same analysis found more than 17% of D.C. residents have student loan debt, second only to Maryland.
"D.C. is an area that attracts a lot of professionals and a lot of professionals that need a high level of education in order to be competitive," Jacob Channel a Senior Economist with Student Loan Hero explains. "That's just the nature of the beast in the District."
He adds that advanced degrees are a leading cause of the DMV having the highest rate of borrowers with more than $100,000 in loans.
Student Loan Hero researchers also found borrowers in the District are the least likely in the nation to have their entire debt eliminated if a $10,000 loan forgiveness was implemented, but it would free around one in three nationwide from all their debt.
D.C. also continues to top the list of most expensive cities to live in, meaning whether a pause comes or not, some residents may need to start preparing for the end.
"Regardless of what announcements are made people need to be thinking carefully about their payments are going to restart and they need to be budgeting accordingly," Channel warns.
He suggests reaching out to your lender if you are not ready to begin repayments, to see if there are options such as forbearance or repayment plan changes that could help prevent you from falling behind.