Helping community college borrowers
The majority of federal student loan borrowers in default originally borrowed $12,000 or less, according to the DoE.
In particular, this new wave of SAVE Plan relief — which is coming months ahead of schedule — is expected to help people who borrowed smaller amounts to attend community colleges. The DoE estimated the SAVE Plan will make 85% of future community college borrowers debt free within 10 years.
U.S. Under Secretary of Education, James Kvaal, said the action will “help struggling borrowers who have been making loan payments for years, including many who never graduated from college. Giving borrowers with smaller loans a faster path to being debt free will help many borrowers avoid financial distress and have peace of mind.”
Discover how a simple decision today could lead to an extra $1.3 million in retirement
Learn how you can set yourself up for a more prosperous future by exploring why so many people who work with financial advisors retire with more wealth.
Discover the full story and see how you could be on the path to an extra $1.3 million in retirement.
Read MoreThe SAVE Plan
To help borrowers benefit from this debt relief, the Biden administration has launched an outreach and email campaign to encourage Americans to sign up for the SAVE Plan — especially those who may be eligible for immediate student loan forgiveness.
As of January, 6.9 million borrowers were enrolled in the SAVE Plan, which U.S. Secretary of Education, Miguel Cardona, deemed “the most affordable student loan repayment plan ever available.”
Of SAVE enrollees, 3.9 million have a $0 payment — because they are single borrowers earning less than $32,800 per year or a family of four making less than $67,500 — while borrowers who owe a payment are saving an estimated $117 a month (just over $1,400 a year) compared to their previous REPAYE Plans.
“With lower monthly payments, protection from runaway interest, and faster timelines to debt forgiveness, President Biden’s SAVE plan is not only benefiting millions of current borrowers but also providing the students of today and tomorrow with a more affordable pathway to college degrees and credentials,” Cardona added.
Sponsored
This 2 minute move could knock $500/year off your car insurance in 2024
OfficialCarInsurance.com lets you compare quotes from trusted brands, such as Progressive, Allstate and GEICO to make sure you're getting the best deal.
You can switch to a more affordable auto insurance option in 2 minutes by providing some information about yourself and your vehicle and choosing from their tailor-made results. Find offers as low as $29 a month.