Millions of Federal Student Loan Borrowers May Skip July Payment: Biden Admin

Contact Your Elected Officials
The Epoch Times Header

The federal government is working to recalculate a cheaper monthly payment through a new formula.

Millions of federal student loan borrowers may skip their monthly payments in July while the federal government recalculates their bills.

In August, the U.S. Department of Education rolled out the SAVE Plan, an income-driven repayment (IDR) plan aimed at making payments more affordable for low-income borrowers with a shorter timeline toward the eventual discharge of their remaining balances.

The Education Department already started implementing some of SAVEโ€™s โ€œmost generousโ€ offers ahead of schedule, including debt cancellation for borrowers who originally took out $12,000 or less in loans and have made at least 10 years of monthly payments. It also brought 4.6 million borrowersโ€™ monthly payments down to as low as $0.

Starting July 1, a new repayment formula for borrowers enrolled in the SAVE Plan will go into effect. This formula update allows borrowers with undergraduate loans to have their monthly payments capped at 5 percent of their discretionary income, which is down from the current 10 percent limit.

The change means that borrowers with only undergraduate loans will get their monthly bills slashed by half. Borrowers who have graduate school loans will also see a reduction to their payments if they have undergraduate loans as well, and the amount of the reduction will depend on the proportion of their graduate and undergraduate student loan debt.

To make sure loan servicers have enough time to make the recalculations, the Education Department has placed all borrowers who will be affected by the new formula on an โ€œadministrative forbearance.โ€

โ€œAs the Department finalizes preparations with student loan servicers to implement borrowersโ€™ new, lower monthly payments capped at 5 percent for undergraduate loans under the SAVE Plan, some borrowers may be placed in a brief processing forbearance to ensure they can access the full benefits of the SAVE Plan and that their new payment amounts are accurate,โ€ a spokesperson for the Department told The Epoch Times in an emailed statement.

Since borrowers typically get their bills a few weeks before the due date, this one-month forbearance period will help prevent borrowers from making a larger payment than necessary before the federal government determines a new, lower amount.

Byย Bill Pan

Read Full Article on TheEpochTimes.com

The Epoch Times
The Epoch Timeshttps://www.theepochtimes.com/
Tired of biased news? The Epoch Times is truthful, factual news that other media outlets don't report. No spin. No agenda. Just honest journalism like it used to be.

The Very British Stalemate: British Politics Explained for Americans

The assumption in the minds of American commentators, politicians, and analysts is that the UK has "gone to the dogs" with "woke" political ideology.

NFL Vikings Male Cheerleader Controversy ย 

The NFL under the leadership of Roger Goodell is back to yet another controversy that is causing backlash and a possible boycott.

Euronews Is Euro-Trash: Lessons in Media Deception Tactics

Euronews โ€œcoveredโ€ the vicious murder of a 17-year-old Dutch girl by so-called asylum seeker who raped another girl, calling him simply a โ€œ22-year-old man.โ€

The Woke Left Goes Lock, Stock And Cracker Barrel

Another legendary American institution has been targeted by woke leftists. This time it is the popular family restaurant chain, Cracker Barrel, founded inย 1969.

โ€˜Indigenous Drag Story Hourโ€™: A Back-to-Public-School Treat For the Kids

I gave leading child-grooming outfit Drag Queen Story Hour my email to solicit me for funds to convert more public school kids into trannies.

Democrats Map Strategy and Urge Unity โ€™to Win Elections, Not Argumentsโ€™

DNC Chair Ken Martin called upon fellow Democrats to prioritize results over rhetoric as party opened its summer meeting in Minneapolis on Aug. 25.

Federal Reserve Signals Rate Cutโ€”What This Means for Your Money

In Jackson Hole keynote address Fed Chair Powell stated current conditions, a deteriorating labor market, โ€œmay warrantโ€ a change in monetary policy.

Netflix Unveils Opening Dates for Philadelphia, Dallas Entertainment Venues

Opening this fall in Philadelphia and Dallas, the Netflix House complexes will feature themed experiences and a restaurant inspired by Netflix content.

Texas Democrats Take Center Stage at DNC Summer Meeting Amid Redistricting Battles

Texas Democrats got a heroesโ€™ welcome on opening day of the Democratic National Committeeโ€™s summer meeting in Minneapolis.

Trump Floats New Meeting With Kim Jong Un as South Koreaโ€™s Lee Visits White House

President Trump welcomed South Koreaโ€™s new president, Lee Jae Myung, to the White House to discuss trade, investment, and defense collaboration.

Trump Signs Order Targeting American Flag Burning, Desecration

President Trump signed an EO that directs the attorney general to prosecute those caught burning the American flag or desecrating it in other ways.

Trump Signs Executive Orders Aimed at Ending Cashless Bail

Trump signed two EOs aimed at eliminating cashless bail, along with order adding specialized law enforcement units to executive agencies in Washington.

Airbnb Co-founder to Redesign Thousands of US Government Websites

Airbnb co-founder Joe Gebbia is honored to redesign thousands of U.S. government websites after he was appointed as Trumpโ€™s new design chief.
spot_img

Related Articles