New Student Loan Repayment Plan Introduced by Biden Administration to Reduce Costs
The Biden administration is making changes to student loan repayment plans in order to reduce the monthly payments and minimize the impact of unpaid interest. These changes could save the typical borrower $1,000 a year and $2,000 a year for a typical graduate of a four-year public college or university. The plan, called SAVE, will base monthly payments on income rather than the total loan balance and prevent loan balances from growing due to unpaid interest. This plan aims to provide relief to low- and middle-income borrowers, community college students, and those in public service. It is part of President Biden’s efforts to address student debt, despite some legal obstacles that have blocked certain aspects of his debt relief plan. The recent data shows a decline in student loan balances to $1.57 trillion in the second quarter.
