The Biden administration unveiled its proposed expansion of income-driven repayment (IDR) for student loans on Tuesday January 10, 2022. The proposal will slash monthly payments for most borrowers and dramatically increase the cost of the loan program.
Rather than creating an entirely new repayment plan, the administration intends to revise an existing IDR plan, known as REPAYE, to make it more generous. The following are the most significant changes:
The amount of income exempt from student loan payments will rise from 150% of the federal poverty line to 225%. For a single borrower in 2023, this threshold is $30,578.
For ...
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Error by DOE Contractor Causes Confusion on Student Loan Relief
Millions of student-loan borrowers will soon receive an updated email on the status of their debt relief.
In late November, approximately 9 million borrowers received an email from President Joe Biden's Education Department with a subject line that stated: "Your Student Loan Debt Relief Application Has Been Approved." However, that subject line was incorrect, Insider has learned — it was simply supposed to inform borrowers that their applications had been received with the subject line: "Update on Student Loan Debt Relief."
This error was made by Accenture Federal Services, a contractor of the Department of Education, While the content ...
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Borrower Beware – More Uncertainty For Student Loan Relief in Bankruptcy
The Biden administration’s decision to make it easier to discharge student loans in bankruptcy could offer a new safety valve for debtors who have exhausted other options for getting out from under heavy debt loads, the Wall Street Journal reported on November 21, 2022.
The move, announced November 17, 2022, comes as President Biden’s broader plan for mass student-debt cancellation has been placed in limbo after being blocked by two separate Federal Courts. The proposed plan calls for canceling up to $20,000 in debt for borrowers under certain income thresholds. It would render up to 20 million people free of debt, around half of all ...
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What If I Do Not Qualify for Student Loan Forgiveness?
President Biden’s recent announcement proposes to forgive up to $20,000 for borrowers earning less than $125,000 a year.
For people who don't qualify for Biden's loan forgiveness program or may still have student loan balances left even after forgiveness, there are still options available to reduce student loan obligations. Please note that each of these programs have been available for some time and have stringent limitations. You should contact your servicer or https://studentaid.gov for more information.
Working for the Federal Government
People who work for the federal government could have a government agency repay their ...
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Biden Admin Reinstates Forgiveness of Student Loans Caused by Fraud
Tens of thousands of borrowers who attended for-profit schools like Corinthian Colleges and ITT Technical Institute that defrauded students will have their student loan debts eliminated after the Education Department rescinded some changes made during the Trump administration that gutted a relief program, the New York Times reported. “Borrowers deserve a simplified and fair path to relief when they have been harmed by their institution’s misconduct,” said Miguel Cardona, the education secretary. “We will grant them a fresh start from their debt.” The change will eliminate around $1 billion in student loan debt owed by around 72,000 borrowers, ...
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Six Million FFELP Borrowers Left In Limbo
When the U.S. government bailed out student loan lenders during the Great Recession, legislators unintentionally set off a series of cascading events that has left more than 6 million student loan borrowers locked out of a crucial benefit more than 10 years later amid the coronavirus pandemic.
Two consumer advocacy groups are pressing the Biden administration to change that.
"The Trump administration exercised executive authority to cancel student loan interest charges and pause loan payments for over 40 million federal student loan borrowers," a joint letter from the Student Borrower Protection Center and the National Consumer Law ...
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Five Credit Mistakes Older Americans Make
Seniors are getting squeezed in so many ways. Healthcare and other basic expenses are rising. Fewer have pensions to supplement their Social Security income in retirement. Low interest rates mean what savings they do have isn’t growing quickly — unless they are willing to invest in higher-risk financial products.
And then there’s the other side of the equation: credit. debt, credit report mistakes and identity theft can quickly bring down credit scores older Americans have carefully built over several decades. Here are five major credit mistakes older Americans make, and what to do about them.
1. Using Too Much Credit
Older Americans ...
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Student Loan Relief Belongs in Bankruptcy Court
Let's stop the nonsense about absolute student loan forgiveness.
I think we can all agree that if a student who never got a degree after incurring student loan debt, and is in a low paying job, that student should be afforded some relief as long as they can prove that they do not have the ability to pay the debt. As noted in last week's WSJ, this would level the playing field between the haves and have nots. The place to do this is in Bankruptcy Court. The mechanisms are already in place and have worked fairly well for the LAST 15 YEARS. Between exemptions that are allowed with respect to property that can be protected and the means test ...
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Student Loan Crises Must Be Addressed Before It Gets Much Worse
While Wall Street and U.S. President Donald Trump tout news of a booming stock market and low unemployment, college students may be quick to roll their eyes. The improved economy has yet to mean higher wages for graduates already struggling to pay down massive debt, let alone ease the minds of students staring down the barrel of six-digit loan obligations yet to come.
Federal student loans are the only consumer debt segment with continuous cumulative growth since the Great Recession. As the cost of tuition and borrowing continue to rise, the result is a widening default crisis that even Fed Chairman Jerome Powell labeled as a cause for ...
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Parents Are Wising Up About Student Loan Debt
Parents are wising up when it comes to taking on debt to pay for their children's college education. According to a survey by T Rowe Price, parents are less willing to take on more than $75,000 in Student loan debt towards their children's education this year.
At the same time, more parents are willing to take on college debt that is less than $25,000 - a much more manageable figure. Those changing attitudes come alongside other good news for parents: They are losing less sleep over college costs.
The survey found that only 14 percent of parents are willing to take out more than $75,000 in debt to pay for their children's college this ...
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