With student loan repayments about to resume this coming fall, a massive change is coming for borrowers.
A student enjoying her coffee (Photo: CNBC)
Massive Changes For Student Loan Repayment
Since President Biden paused student loan repayments for the last three years, it is about to resume this coming fall. With that, borrowers brace themselves as they would have to honor their obligations in student loan repayments. Fortunately, the U.S. Department of Education announced the SAVE (Saving on a Valuable Education) plan for student loan repayment. As announced by the Education Department, this would be the most affordable and beneficial student loan repayment plan to be implemented.
Under the SAVE plan, borrowers would have their student loan repayments cut in half, leaving most borrowers with no monthly bill for student loan repayment. As stated by higher education expert Mark Kantrowitz, the SAVE plan is “very generous” to borrowers in student loan repayment.
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When Would These Changes For Student Loan Repayment Start?
With regards to when would the SAVE plan be implemented for student loan repayment borrowers, most benefits will not take effect until the summer of next year. This is due to the timeline of the changes in student loan repayment and its resumption.
Also, the SAVE plan would allow the Education Department to eliminate the putting interests that would not be covered by the borrower’s monthly payments in student loan repayment. Married couples would no longer be required to include the income of their partner when calculating the repayments if they filed their taxes separately.
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