Looks good in the press

Now let's see if it gets through the GOP.

The accelerated forgiveness drew fire from Republicans, who called it an attempt to win voters ahead of the 2024 presidential election.

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Republicans have railed against the new repayment plan, saying it helps wealthier Americans with college degrees at the expense of taxpayers who didn’t attend college. Some say it’s a backdoor attempt to make community college free, an idea that Biden campaigned on but that failed to win support in Congress.

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Loan forgiveness was originally set to begin in July under the new SAVE repayment plan, but it’s being accelerated to provide faster relief to borrowers, President Joe Biden said Friday.

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Borrowers will be eligible for cancellation if they are enrolled in the new SAVE plan, if they originally borrowed $12,000 or less to attend college, and if they have made at least 10 years of payments.

  AP

I wonder how many people are still paying on a $12,000 college loan after ten years of payments.

The new repayment plan offers far more generous terms than several other income-driven repayment plans that it’s meant to replace. Previous plans offered cancellation after 20 or 25 years of payments.

Perhaps there weren't ANY people in that situation.

Counterintuitively, those with smaller student loan balances tend to struggle more. It’s driven by millions of Americans who take out student loans but don’t finish degrees, leaving them with the downside of debt without the upside of a higher income.

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The new plan also lowers monthly payments for millions of borrowers.

Those who took out more than $12,000 will be eligible for cancellation but on a longer timeline.

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Biden announced the new repayment plan last year alongside a separate plan to cancel up to $20,000 in loans for millions of Americans. The Supreme Court struck down his plan for widespread forgiveness, but the repayment plan has so far escaped that level of legal scrutiny. Republicans in Congress tried unsuccessfully to block the new repayment plan through legislation and a resolution last year.

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Starting next month, the Education Department says it will automatically wipe away balances for eligible borrowers enrolled in the SAVE plan. The department will email borrowers who might be eligible but have not enrolled.

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Other parts are scheduled to take effect in July, including a change to limit borrowers’ payments to 5% of their discretionary income, down from 10% in previous income-driven repayment plans.

The Biden administration is separately pursuing another plan for widespread cancellation. After the Supreme Court rejected Biden’s first plan, he asked the Education Department to try again under a different legal authority. The department has been working on a new proposal that would provide relief to targeted groups of borrowers.