"Ron has amazing insight into the financial and real estate markets."
doug waldman
Can President Biden’s New student loan plan SAVE borrowers?
Hi,
It's Ron Siegel again. We want to share a lot of information regarding the Biden Administration's new plan that was rolled out after the Supreme Court turned down loan forgiveness, called the "SAVE" plan, or the Saving on Valuable Education plan.
Here's a summary of some key points you shared:
1. Supreme Court Decision: The Supreme Court rejected the authority of the Biden Administration to give blanket forgiveness of student loans, of around $10,000 to $20,000. The administration is now considering other options, including refiling for forgiveness using the Higher Education Act instead of the Heroes Act.
2. Biden's SAVE Plan: In response to the court's decision, the Department of Education rolled out an email detailing the SAVE repayment plan. This plan aims to reduce loan repayments for those earning under $32,800 to $0 and reduce repayments for a family of four earning up to $67,500.
3. Discretionary Income Increase: The plan increases the discretionary income used in calculating the borrower's repayment. The threshold has increased from 150% of the poverty line to 225%, which allows borrowers to earn more before having to start repaying their student loans.
4. Interest Reduction: The SAVE plan will eliminate 100% of interest for both subsidized and unsubsidized loans after a scheduled payment is made under the plan.
5. Spousal Income Exclusion: The SAVE plan will exclude spousal income for borrowers who are married but file their taxes separately.
6. Implementation Time: The SAVE plan will come into effect in July 2024, and its details will be clarified before then.
7. Streamlining: The plan also includes other updates to streamline the process, such as ending interest capitalization when borrowers leave income-driven repayment (IDR) plans, automatic IDR recertification, and the option for catch-up payments to gain credit for periods of deferment or forbearance.
However, there are still questions and concerns regarding some aspects of the plan, like the moving target timeline for repayment based on how much one has borrowed, the implementation of secure access to tax information, and more. It's important for student loan borrowers to stay informed about these developments, as they can have a significant impact on their repayment strategies and financial planning. If you have any further questions or need more clarity, feel free to ask.
Remember, understanding your options is the key to making the best financial decisions. If you have any other questions, feel free to let me know.
It's Ron Siegel again. We want to share a lot of information regarding the Biden Administration's new plan that was rolled out after the Supreme Court turned down loan forgiveness, called the "SAVE" plan, or the Saving on Valuable Education plan.
Here's a summary of some key points you shared:
1. Supreme Court Decision: The Supreme Court rejected the authority of the Biden Administration to give blanket forgiveness of student loans, of around $10,000 to $20,000. The administration is now considering other options, including refiling for forgiveness using the Higher Education Act instead of the Heroes Act.
2. Biden's SAVE Plan: In response to the court's decision, the Department of Education rolled out an email detailing the SAVE repayment plan. This plan aims to reduce loan repayments for those earning under $32,800 to $0 and reduce repayments for a family of four earning up to $67,500.
3. Discretionary Income Increase: The plan increases the discretionary income used in calculating the borrower's repayment. The threshold has increased from 150% of the poverty line to 225%, which allows borrowers to earn more before having to start repaying their student loans.
4. Interest Reduction: The SAVE plan will eliminate 100% of interest for both subsidized and unsubsidized loans after a scheduled payment is made under the plan.
5. Spousal Income Exclusion: The SAVE plan will exclude spousal income for borrowers who are married but file their taxes separately.
6. Implementation Time: The SAVE plan will come into effect in July 2024, and its details will be clarified before then.
7. Streamlining: The plan also includes other updates to streamline the process, such as ending interest capitalization when borrowers leave income-driven repayment (IDR) plans, automatic IDR recertification, and the option for catch-up payments to gain credit for periods of deferment or forbearance.
However, there are still questions and concerns regarding some aspects of the plan, like the moving target timeline for repayment based on how much one has borrowed, the implementation of secure access to tax information, and more. It's important for student loan borrowers to stay informed about these developments, as they can have a significant impact on their repayment strategies and financial planning. If you have any further questions or need more clarity, feel free to ask.
Remember, understanding your options is the key to making the best financial decisions. If you have any other questions, feel free to let me know.