Despite the U.S. Supreme Court’s ruling against President Biden’s student debt relief program, his administration is still putting forth other efforts to support borrowers.
President Joe Biden and Education Secretary Dr. Miguel Cardona
These efforts come in the form of a rulemaking process for an alternative path to debt relief; a new repayment plan; and a 12-month repayment “on-ramp” – Oct. 1, 2023 to Sep. 30, 2024 – so that borrowers who miss monthly payments during this period are not considered delinquent.
There will be a virtual public hearing Jul. 18 about the rulemaking effort, where individuals can submit written comments.
The repayment plan, Saving on a Valuable Education (SAVE), will half the amount undergraduate loan borrowers have to pay a month from 10% to 5% of discretionary income; make it so that borrowers earning under 225% of the federal poverty level won’t have to make monthly payments under this plan; forgive loan balances after 10 years of payments for those with original loan balances of $12,000 or less; and not charge borrowers with unpaid monthly interest.
The plan will be open to borrowers this summer before monthly payments are due.
