The new Biden student loan forgiveness plan will offer borrowers the opportunity to cut their loans in half through an income-driven repayment plan.
Biden Studen Loan Forgiveness Plan will help borrowers ease their burden. (Photo: Forbes)
Biden Student Loan Forgiveness Plan
The Biden administration announced last year the student loan forgiveness program up to $20,000 but it was blocked by a federal judge. Despite this, a new Biden student loan forgiveness plan will give borrowers an opportunity to cut their loans in half.
In a published article in KIPLINGER, the new Biden student loan forgiveness plan is the other way that the administration can help borrowers ease their burden. One of these is through the income-driven repayment plan which was officially proposed earlier this year.
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What is Income-Driven Repayment Plan in Biden Student Loan Forgiveness Plan
Under the Biden student loan forgiveness plan, borrowers can now pay their loans easier through the income-driven repayment plan. This means that they can pay their student loans appropriately based on their income and family size. This plan of paying student loans will be more affordable for the borrowers.
There are four types of income-driven but the Department of Education proposes changes to the Revised Pay As You Earn Plan or REPAYE Plan. Under the Biden student loan forgiveness plan, here are the proposed changes:
- Smaller Monthly Payments
- Shorter Time Until Forgiveness
- Interest Subsidy
The Department of Education is proposing to have changes to the provisions stated above. Furthermore, borrowers can check if they are qualified for the new Biden student loan forgiveness plan. It is expected that the plan will begin on July 1, 2024.
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