Biden administration rolls back tuition, reopens student loan repayment programs
Attorney Virginia Foxx, RN.C., reacts to President Biden’s fourth attempt to cancel student loan debt on ‘The Big Money Show.’
Two student loan repayment programs have been reopened for registration by the Department of Education (DOE) following a federal court order challenging the Biden administration’s Savings in Value Education (SAVE) program.
New enrollments in the Pay As You Earn (PAYE) and Income-Contingent Repayment (ICR) programs were suspended last summer in an effort to disenfranchise and encourage borrowers to sign up for the Biden-Harris administration’s SAVE program, but now people can sign up again.
“The Department continues to defend in court the authority to terminate payments to high-credit and low-income borrowers through the SAVE program,” said US Education Secretary James Kvaal in a statement. “In the meantime, we’re making more options available to low-income borrowers, teachers, workers, and other public employees so they can make the best decisions for their financial situation.”
The two restructured programs offer Public Service Loan Forgiveness (PSLF) and income-driven repayment (IDR). Monthly payments are set by the borrower’s income, family size and allow borrowers to receive forgiveness after “extended payment periods,” the DOE said.
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Student loan borrowers are holding a rally in front of the White House to celebrate President Biden canceling student debt and starting the fight to cancel any remaining debt on Aug. 25, 2022 in Washington, DC. (Paul Morigi/Getty Images for We the 45m / Getty Images)
“Many government employees are using it to keep their monthly salary low as they work to earn PSLF after 10 years,” said a DOE press release.
Although SAVE is tied up in court, borrowers do not owe the loan and the loan is interest-free, but they also do not receive credit from the PSLF or “make progress toward satisfying IDR programs.”
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President Biden, right, is joined by Education Secretary Miguel Cardona as he announces new measures to protect borrowers after the Supreme Court struck down his student loan forgiveness program in the Roosevelt Room of the White House on June 30, 2023. (Chip Somodevilla/Getty Images/Getty)
The US Department of Education building is shown in Washington, DC (SAUL LOEB/AFP via Getty Images/Getty Images)
Borrowers in the SAVE portfolio should not consider switching as they currently receive no interest, Forbes reports. However, borrowers who are close to PSLF loan forgiveness, who are close to the 120 credit score or who qualify for PSLF repayment may want to consider it, the press release said.
New PAYE and ICR registrations will be open until July 1, 2027, the DOE said.
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Additional borrower information can be found on the DOE website.
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