Student Loan Repayments Restart
As of Sept. 1, the pause on student loan repayment, which had
been in place since March 13, 2020, ended. This means that repayment requirements and interest accrual have resumed.
In a related development the Department of Education recently announced the revision
to the Obama-era income-driven repayment (IDR) plan, Revised Pay-As-You-Earn (REPAYE).
The new plan is Saving on a Valuable Education (SAVE) plan. Under the new SAVE
plan, a single borrower earning less than $15 an hour would be exempt from making
student loan payments and those earning above that amount would save at least
$1,000 on their IDR payments. There are additional benefits according to ED, and
we will report further on the details in the near future. Graduate students that
have undergraduate and graduate school debt will be eligible to pay a weighted
average of between 5% and 10% of their income based on the original principal balances of their loans.
U.S. Rep. Virginia Foxx, Ed.D., (R-N.C.), the Chair of the House Committee on Education
and the Workforce, and U.S. Sen. Bill Cassidy, M.D. (R-La.), Ranking Member of
the Senate Health, Education, Labor and Pensions Committee have introduced a Congressional
resolution of disapproval in their respective Houses to halt the Biden administration’s
implementation of the changes. Such legislation would have to pass both Houses
and be signed by the President, which is unlikely. |