![]() ![]() ![]() ![]() The Education Department’s new Fresh Start program is now available for borrowers in default on their federal student loans. Borrowers In Default Have Other Student Debt Relief Options Some elements of the SAVE plan are expected to be available by the time student loan payments resume. The SAVE plan will reduce many borrowers’ monthly student loan payments by nearly $100 per month or more, according to the Education Department. The plan is effectively an overhaul of the Revised Pay As You Earn (REPAYE) plan, one of the available income-driven repayment options. However, unlike the student loan pause period, missed payments will not count toward student loan forgiveness for income-driven repayment or Public Service Loan Forgiveness.īiden also announced a new student loan repayment plan tied to a borrower’s income, called the Saving on a Valuable Education (SAVE) plan. But borrowers will not incur late fees, penalties, or negative credit reporting for missing payments. During this time, payment will be due and interest will accrue. In response to last week’s Supreme Court decision on student loan forgiveness, President Biden announced new initiatives to ease borrowers’ transition into repayment.īorrowers will have a 12-month “on-ramp” period following the end of the student loan pause. New Biden Student Debt Relief Initiatives To Ease Transition To Repayment You’ll get your bill in September or October - at least 21 days before your payment due date - with your payment amount and due date,” says updated department guidance. “Your first payment will be due in October 2023. So while interest will resume in September, student loan payments won’t actually be due until the following month. Federal law requires the Education Department and its contracted loan servicers to generate and send billing statements to borrowers, and to provide borrowers with a sufficient window to pay their student loans before the billing due date. ![]()
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