Federal student loan borrowers can expect “the most affordable student loan plan ever”, Biden said in a video address on Tuesday announcing significant changes to the debt from higher education held by over an eighth of the country.
To me, the biggest wins is that interest cannot overcome your payment. So many people have loans that are more than they started with. Holding steady isn’t great, but it’s still a massive step forward. The forgiveness rules do mean that effectively some people have to pay until death. There’s no upper limit for forgiveness. More loans means longer payments. I was hoping for a cap help cool the cost of college because lenders would think twice with the interest cap and a known end of life.
More affordable than total elimination?
“Most affordable ever” does not mean “most affordable possible.” He tried that. SCOTUS stopped him. He’s doing what he can to make the situation better.
Honestly I think this is better on the whole. Not if you were going to get your loans forgiven - I get that - but for today and tomorrow’s borrowers, this policy will be a positive thing and will still help current debt holders, too.
Fed loans should be scrapped, the reason college is so expensive is colleges see that the gov will give loans to anyone and back them up. The second that this became the norm, these colleges just saw a blank check.
He tried total elimination. But Republicans and the activist SCOTUS ruined that dream.
This always baffles me. I hear people say “I’m never voting for a Democrat again! They couldn’t get student loan forgiveness done!!”
You think Republicans will get student loan forgiveness done? You think not voting will get student loan forgiveness done? Think again.
Biden and Democrats are doing everything they possible can in a hostile environment where Republicans sue as soon as any forgiveness is on the horizon. And Trump’s SCOTUS is there to help Republicans in that effort.
Elections have consequences! Vote!
Those people are liars. They were never going to vote for a Democrat.
What’s to stop them from ruining this one?
🤷🏻♀️
No, he didn’t. He tried the motions. The President does not have to collect on a debt or collect a tax without Congress forcing it. Which Congress can’t practically do.
Biden chose to restart payments.
The program, named Save (Saving on A Valuable Education), will replace the Revised Pay As You Earn (Repaye) plan, lowering the minimum amount due on student loans for borrowers who enroll in an income-driven repayment (IDR) plan.
Under the old rules, borrowers enrolled in this plan were required to pay at least 10% of their discretionary income, or the difference between their adjusted gross income (AGI) and 150% of the federally designated poverty line. Now, borrowers only have to pay the difference between their income and 225% of the poverty line.
Whenever a politician says the word affordable in quotes, I get nervous.
Biden also launched a significant increase to both interest rates and payments. His plan is worse than how things were when he took office.
Anyone know how this affects a homemaker that still has student loans. Is the income based on the household income or the loan holder whose current income is 0?
Edit:
From a nerdwallet article I found this:
Benefits for some married borrowers. Spousal income for borrowers who are married and file taxes separately will be excluded from IDR payment calculations; spouses no longer required to co-sign your IDR application.
So it looks like maybe filing separate can be a possibility though have to research any other tax implications.
This actually seems quite managable. ICR loans are used for student debt in the UK too.
