SAVE PLAN- July 1st Updates
from The Student Loan Doctor Audio Newsletter Hosted by Dr. Sonia Lewis
🎙️ Podcast Show Notes: Faster Student Loan Forgiveness and Lower Payments Under Biden’s SAVE Plan 🎙️ Episode Highlights: 1 Introducing the SAVE Plan: ◦ President Joe Biden debuted the SAVE plan last fall, hailed as the most affordable and beneficial income-driven repayment plan. ◦ Key features include lower monthly payments, an interest subsidy to prevent balance increases, and accelerated forgiveness for small debt amounts. 2 Major Updates Effective July 1: ◦ New repayment formula slashes monthly payments for undergraduate borrowers by half, reducing the discretionary income formula from 10% to 5%. ◦ Graduate loan borrowers with undergraduate debt will also see payment reductions proportional to their combined debt. 3 Student Loan Payments Paused for July: ◦ Over 8 million borrowers enrolled in SAVE will have payments recalculated. ◦ To avoid chaos, the Education Department has placed impacted borrowers in administrative forbearance for July, cancelling any due payments. 4 Forbearance Notices and Interest Rate Benefits: ◦ Borrowers are receiving notices about the administrative forbearance from July 1 to July 31. ◦ No payments required and interest rates temporarily set to 0%. 5 Forbearance Counts Toward Forgiveness: ◦ New regulations allow mandatory processing forbearances to count toward forgiveness for IDR plans and PSLF, a significant change from past practices. Stay Informed: Sign up for a consultation with a SLD coach: Click Here Register for an Upcoming Student Loan Expert Info Session: Click Here
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