The Biden admin is in the process to try to soften the blow of the upcoming resumption of Federal student loan payments…
This program will be income based….
This effort is sure to be challenged in the courts by those who are against ANY student loan forgiveness….
Previously, the administration had numerous IDR options for borrowers, which advocates have said led to a confusing system for borrowers.
The new SAVE plan will replace the Revised Pay As You Earn Repayment (REPAYE) plan, one of the most widely used of the four IDR options available to borrowers. The other three IDR plans will be phased out or limited by the department.
The SAVE plan will make three significant changes this year compared to the REPAYE option. The first raises the income exemption from 150 percent above the poverty line to 225 percent, meaning a single person earning less than $32,800 would have $0 monthly payments under the plan.
The plan also won’t allow unpaid interest to grow if a person is making their monthly student loan payments. Lastly, spousal income for borrowers who are married and file separately will not be included.
The website — first reported by CNN — shows a demo of the application process, where some information, such as tax returns, can be automatically inserted due to information the government has on file for a borrower.
“We will be able to show borrowers their exact monthly payment amount and give them the ability to choose the most affordable repayment plan for them,” one official told CNN…..