Firstly, let's examine the potential benefits this plan may bring to homebuyers. Student loan forgiveness will save borrowers a significant amount of interest expenses, meaning homebuyers may have more funds available for down payments and transaction costs, while also being able to more easily obtain higher mortgage amounts. This will be particularly helpful for first-time homebuyers, as they typically require additional financial support to enter the real estate market.

However, this plan may also have some negative effects on the housing market. Firstly, student loan forgiveness may stimulate housing demand, especially for first homes at lower prices. With more homebuyers rushing into the market, and housing supply relatively limited, prices may rise as a result. This could pose a challenge for first-time homebuyers seeking relatively lower-priced properties.

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Furthermore, while student loan forgiveness can help homebuyers save on down payments, rising house prices may offset these savings. Homebuyers may find themselves in a dilemma: while they have more purchasing power, rising prices make the properties they can afford more expensive, thus reducing their actual purchasing power.

Lastly, the student loan forgiveness plan may also face opposition and lawsuits from Republican lawmakers, which could affect the implementation and effectiveness of the plan.