UPDATES to ALL the IMPORTANT Details of Biden SAVE repayment plan

ENROLL & SAVE: What You Need to Know on Updates to NEW Student Loan Repayment from Biden

By Mrs. B Finesse, M.S.

There have been updates to student loan repayment plans. This new plan will help over 1 million people qualify that would not have before.

I want the Finesse Finance family here to get ALL the latest information to help student loan borrowers and their families. Here is a breakdown of the updates:

If you submit an IDR application now, it will be processed and there will be no need to resubmit it. However, the application may not be consistently available during the beta testing phase, so you may need to try again later if the website not accessible.

If you were already enrolled in the REPAYE Plan or recently applied, you will automatically be placed on the SAVE Plan. You don’t need to reapply or request a plan change.

To apply for the SAVE Plan, you can use the IDR application and select the option for your loan servicer to put you on the lowest monthly payment plan, which is usually the SAVE Plan.

If you are already on an IDR plan, check if you are on the REPAYE Plan by logging into StudentAid.gov and viewing your loans on the My Aid page. If you are on REPAYE, you will be automatically enrolled in the SAVE Plan later this summer. If you are on a different plan, you will need to switch to REPAYE or SAVE (once available) to receive the benefits of the SAVE Plan. Create a StudentAid.gov account if you don’t have one.

The monthly payment under the SAVE Plan is calculated based on your income and family size. If your annual income is $32,800 or less (approximately $15 per hour), your monthly payment will be $0. If you earn more than that, you will save at least $1,000 per year compared to other IDR plans.

Source: U.S. Department of Education

Note: The SAVE Plan benefits mentioned here are effective starting in July 2024

• Starting in July 2024, the SAVE Plan will introduce additional benefits to further reduce payments and ease repayment.

• Undergraduate loan payments will be reduced from 10% to 5% of income above 225% of the poverty line.

• Borrowers with original principal balances of $12,000 or less will receive forgiveness of any remaining balance after making 10 years of payments, with the forgiveness period increasing by one year for every additional $1,000 borrowed.

• Consolidating loans will not result in the loss of progress toward forgiveness, and credit will be given for payments made based on the consolidated loan balance.

• Certain periods of deferment and forbearance will automatically count toward forgiveness, and borrowers will have the option to make additional “catch-up” payments for other deferment or forbearance periods.

• Borrowers who are 75 days late will be enrolled in IDR if they have allowed the Department of Education access to their tax information.

• A $0 monthly payment is possible if your household income is below the threshold protected by IDR plans. Recertification of your IDR plan will adjust your payment based on updated income and family size information.

If you apply for the SAVE Plan this summer, your application will be processed in time for your first payment due date, although it may take a few weeks for your servicer to complete the processing.

Comment below how the NEW repayment plan will HELP you or someone in your family.