Court Passes Biden’s College Debt Relief Plan to Move Forward

(VitalNews.org) – A federal appellate court has filed a motion that would allow an important part of Biden’s student loan forgiveness plan to move forward.

The approval of this motion would mean that millions of borrowers would see their loan payments cut in half. The United States Supreme Court struck down Biden’s original ambitious goals to forgive up to twenty thousand dollars in federal student loans for every borrower. This plan, called SAVE, was a change for many Americans who had thousands in student loans to pay back.

The plan would work by looking at the borrower’s income and family size to calculate their monthly payment; it can cut these payments down even more by considering the borrower’s AGI, or adjusted gross income.

Biden’s plan was at a standstill when two federal judges blocked parts of it. Many borrowers were expecting their student debt payments to be halved, but the pending litigation put everything on hold. With this said, the latest ruling from a three-judge panel on the United States Court of Appeals would allow Biden to move forward while cutting the lower monthly payments from ten percent to five percent.

Miguel Cardona, the Department of Education Secretary, said, “The US Court of Appeals for the 10th Circuit sided with student loan borrowers across the country who stand to benefit from the Save Plan.” He continued, “Borrowers enrolled in the Save Plan can still access its considerable benefits, including undergraduate loan payments cut in half, as well as protection against interest accruing if borrowers are making their monthly payments.”

The U.S. Education Department said that borrowers would start paying a halved price in August after being put on a hold in July during the pending litigation.

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