Main Topic: Federal appeals court halts a rule from President Biden's administration regarding student loan debt relief for borrowers who claim they were misled about the quality of education.
Key Points:
1. The rule broadens existing policy to end the debt of students who were misled by colleges and universities.
2. Career Colleges and Schools of Texas filed a lawsuit against the rule, arguing that it covers unintentional actions and gives excessive power to the Department of Education.
3. The 5th U.S. Circuit Court of Appeals granted an injunction and will hear arguments in November.
President Biden's student-debt relief plan, which aimed to wipe out up to $20,000 of borrowers' balances, has been struck down by the Supreme Court, prompting the administration to develop a new plan while payments are set to resume soon.
A survey reveals that 62% of student loan borrowers in the US are considering boycotting loan payments due to doubts about affordability, with half of respondents believing a boycott could lead to total debt forgiveness, raising concerns about the risks and consequences of refusing to repay student loans.
Republicans seeking the 2024 GOP presidential nomination, including former President Donald Trump, oppose President Joe Biden's plan to cancel student debt, with many arguing that it is unfair and burdensome to taxpayers while undermining personal responsibility.
Advocacy groups and elected officials are urging the Biden administration to implement student loan forgiveness, even after the Supreme Court struck down Biden's debt cancellation plan, and are pushing for the establishment of a new student loan forgiveness plan under the Higher Education Act.
As part of President Biden's efforts to make student loans more manageable, the administration has created a 12-month on-ramp to repayment starting in October 2023, allowing borrowers to delay payments without negative consequences, although interest will still accumulate; however, the administration's new SAVE income-driven repayment plan may be a better option for some borrowers.
Borrowers with federal student debt can use their remaining funds in a 529 college savings plan to pay off up to $10,000 of their debt, providing a potentially appealing option as student loan bills are set to resume in October.
House Republicans have advanced legislation to overturn President Joe Biden's new student loan repayment program, which lowers monthly payments and caps interest, while Biden officials promote it as a crucial tool to help Americans manage their federal student loan payments.
The Biden administration has introduced a new federal student loan repayment plan called SAVE (Saving on a Valuable Education) that calculates monthly payments based on a borrower's income and family size, and offers forgiveness after 10 years of payments.
Hundreds of thousands of borrowers in the US are set to receive at least $6 billion in student loan forgiveness, but a major loan servicer is being accused of violating the terms of the agreement, adding to the ongoing issues faced by borrowers as student loan payments resume.
The Biden administration has approved over $22 billion in student loan forgiveness for borrowers who were defrauded by their schools, and they have announced another $37 million in relief for defrauded borrowers from the University of Phoenix.
The Biden administration is allowing a "grace period" for student loan borrowers to skip payments without defaulting, but interest will still accrue and borrowers may face financial consequences in the long term.
Millions of student-loan borrowers are facing the resumption of monthly payments, but there are options for those who can't afford it, though falling behind on payments could lead to severe consequences.
President Joe Biden announced a new round of federal student loan forgiveness, erasing $9 billion in debt for 125,000 borrowers and totaling $127 billion since he took office.
U.S. President Joe Biden plans to announce an additional $9 billion in student debt relief for 125,000 borrowers, bringing the total approved debt cancellation by the administration to $127 billion for nearly 3.6 million Americans.
The Biden administration has announced an additional $9 billion in student debt relief, providing fixes to income-driven repayment plans, public service loan forgiveness, and debt cancellation for borrowers with disabilities. This relief will benefit approximately 125,000 borrowers and is part of the administration's efforts to address obstacles and breakdowns in federal programs.
President Joe Biden has announced that an additional 125,000 Americans have been approved for $9 billion in student loan debt relief, bringing the total approved debt cancellation by the Biden administration to $127 billion for nearly 3.6 million Americans.
The resumption of student loan payments in the US raises concerns about the financial vulnerability of borrowers, although the Biden administration's SAVE plan is expected to alleviate some of the burden by offering more generous repayment options. Black borrowers, who already have larger outstanding debts on average, face additional challenges in paying down their loans due to earning disparities in the labor market. The growth of student loan debt has slowed during the payment pause, but it remains to be seen how it will change once the pause ends.
