Biden’s SAVE Program Could Help Families
Biden’s Students Loan Program save families
SAVE Program Could Help Families as Student Loan Payments Resume
In the recently published article by Fatherly, unveiled the first phase of its new income-driven student loan repayment plan by Biden administration . After more than three years of COVID-19-related pandemic payment pauses which first initiated and extended by former President Donald Trump and extended by current the President Biden several times.
Student loan payments resume gives financial shock to many, as new monthly payments hit family budgets. As the student loan payments resume, the interest also resumes on September 1, and payments on October 1. Biden’s new income-driven repayment plan — SAVE (Saving on a Valuable Education) — replaces the existing Revised Pay As You Earn (REPAYE). The student loan payments resume but some borrowers will pay $0 a month under the new SAVE program.
The student loan payments resume under SAVE is potentially big news for families, given that borrowers between the ages of 35 to 49 — peak parenting years in the U.S. — make up the largest group of borrowers by far (at 14 million) and owe the most in federal student loans. Family size directly affects student loan payments resume and how much borrowers will pay each month. But for all student loan borrowers, 80% of whom are under 50, the program has the potential to change their financial lives.
Read Also: Biden opened a new student debt repayment plan. Here’s how to enroll in SAVE.
SAVE is the latest repayment plan designed as the student loan payments resume, this is to adjust monthly payments for borrowers based on family size and income. On REPAYE IDR plan, it requires borrowers to allocate 10% of their income each month to pay down their student debt while in the student loan payments resume new program SAVE, it aims to help student loan borrowers.
The new SAVE plan as the student loan payments resume, will cut payments on undergraduate loans in half, it will reduce the required loan allocation to a maximum of 5%. So individuals who earn less than $15 per hour as the student loan payments resume, will be exempt from making any payments to student loans under the new SAVE plan. Those who took out loans for graduate school as the student loan payments resume, will unfortunately, still have to pay a higher percentage of their discretionary income.
But SAVE as the student loan payments resume, also different than REPAYE as it raises the amount of income — for both undergraduate and graduate borrowers — that’s protected from repayment.
Read Also:SAVE Repayment Plan Offers Lower Monthly Loan Payments
