he lacked authority to do so. After the decision, Biden he’d find a “new path” consistent with the ruling “to provide student debt relief to as many borrowers as possible as quickly as possible.”
Under the program, borrowers with undergraduate loans will have their payments reduced from 10% to 5% of their discretionary income. Those who have undergraduate and graduate loans will pay a weighted average between 5% and 10% of their income based upon the original principal balances of their loan.
The Department of Education will stop charging any monthly interest not covered by the borrowers SAVE plan payments, they said, so borrowers who pay what they owe on the plan won’t see their loan balances grow due to unpaid interest. The plan would also provide early forgiveness for low-balance borrowers. Under the SAVE plan, borrowers whose original principal balances were $12,000 or less will receive forgiveness after 120 payments .
Biden noted his administration has already approved over $116 billion in student loan debt cancellation for 3.4 million Americans.
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