Who could benefit from the Biden administrations latest plan to relieve student debt
Cory Turner, NPR:
Yes, I mean, as you said, it's an income-based repayment plan, which we have had some version of for roughly the last 30 years.
This is by far more generous than any plan we have ever seen before. And it's not because of one change or two changes the Biden administration is making. It's a handful of changes. So monthly payments are going to be slashed. For undergrad borrowers, ultimately, they will be cut roughly in half.
We will also see roughly a million more borrowers, low-income borrowers, qualify for a zero dollar monthly payment. So, those are a couple of big changes. There's another big one that borrowers are going to feel, which is for folks making those low payments are even a zero dollar monthly payment, in the past, on previous plans, interest kept accumulating.
That won't happen on this plan. Any interest that's not covered by your monthly payment, the government is going to forgive month after month. And one more big change, again, in the past, plans have had a sort of countdown to forgiveness overall, 25 years for graduate borrowers, 20 years for undergraduate borrowers making payments.
This plan includes a 10-year countdown for forgiveness for borrowers with smaller loans, like community college borrowers who take out $12,000 or less.
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