As Student Loan Payments Resume, Ranking Member Scott Highlights Education Department Resources, Reforms to Support Borrowers
WASHINGTON – Today, Ranking Member Scott applauded the Department of Education (ED) for its work to support student loan borrowers as student loan payments and interest accrual resume for the first time in just over three years.
“With the return to student loan repayment underway, student loan borrowers and their families may be worried about their economic security. Thankfully, the Biden-Harris administration is here to help with resources and reforms that will facilitate a smoother transition to repayment and put millions of borrowers on a faster and more affordable path to repayment,” said Ranking Member Scott.
“The Saving on A Valuable Education (SAVE) plan, recently announced by the Department of Education, is the most affordable repayment plan ever offered to borrowers. This plan could allow more than one million additional low-income borrowers to make $0 payments, and it would stop loan balances from ballooning due to unpaid interest. This is the kind of investment that we need to support borrowers, their families, and our economy,” Ranking Member Scott continued. “I applaud the Biden-Harris administration for working extensively with stakeholders to create this plan and coordinating with grassroots organizations to help borrowers benefit from these reforms. I will continue working with the administration to provide borrowers and families with a student loan system that meets their needs.”
Saving on A Valuable Education (SAVE) Plans
In August, ED launched a new Income-Driven Repayment (IDR) plan, Saving on A Valuable Education (SAVE), that will significantly lower monthly payments for many low- and moderate- income borrowers and provide them with clearer and faster pathways to loan forgiveness. Under this plan, borrowers making less than $15 an hour will not have to make any payments and all other borrowers will save more than $1,000 a year on their payments, compared to other IDR plans. Moreover, under these plans, borrowers’ balances will not grow due to unpaid interest.
FOR BORROWERS: studentaid.gov/save
FOR ORGANIZATIONS SUPPORTING BORROWERS: saveonstudentdebt.org/weekofaction
Online Resources for Returning to Repayment
ED has published an array of accessible resources to help guide borrowers through the return to loan payments and interest accrual, including resources for borrowers who are restarting payments, repaying for the first time, or looking for the best repayment strategy.
FOR BORROWERS RESTARTING PAYMENTS: studentaid.gov/restart
FOR BORROWERS REPAYING FOR THE FIRST TIME: studentaid.gov/firstpayment
FOR BORROWERS TO LEARN ABOUT REPAYMENT OPTIONS: studentaid.gov/loan-simulator
FOR BORROWERS CREATING/FINDING THEIR FSA ID: studentaid.gov
Public Service Loan Forgiveness (PSLF)
The Public Service Loan Forgiveness programs allows eligible borrowers employed by a federal, state, local, or tribal government or nonprofit organization to have the remaining balance of their Direct Loans forgiven after making the equivalent of 120 qualifying monthly payments.
FOR ELIGIBLE BORROWERS EMPLOYED IN PUBLIC SERVICE: studentaid.gov/pslf
One-Time Account Adjustment for IDR & PSLF
Last year, ED announced a one-time account adjustment for IDR and PSLF plans to address past inaccuracies, forbearance steering, and deferments. Borrowers may be eligible to receive credit for past periods of repayment, forbearance, and deferment that would otherwise not qualify for IDR or for PSLF.
FOR BORROWERS SEEKING ONE-TIME ACCOUNT ADJUSTMENT: studentaid.gov/idradjustment
Fresh Start Program
Fresh Start is one-time, temporary program that offers borrowers a path out of default and restores their access to federal student aid. Borrowers who access this program will be able to end collections on defaulted loans, remove default from credit reports, and enroll in a repayment plan, including IDR plans.
FOR BORROWERS WITH LOANS IN DEFAULT: studentaid.gov/announcements-events/default-fresh-start
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