A Republican-led effort to block one of President Joe Biden’s student loan debt relief programs in court has succeeded just days before it was set to go into effect.
Decisions by U.S. District Judges John Ross in Missouri and Daniel Crabtree in Kansas, both appointees of former President Barack Obama, on Monday sided with GOP state attorneys general in thwarting Biden’s Saving on a Valuable Education (SAVE) plan, according to Reuters.
The SAVE plan, which was set to go into effect on July 1, was initially announced by Biden in 2022 alongside a since-canceled larger plan that would have erased up to $20,000 in student loan debt for tens of millions of borrowers.
They claim 2.5 million but I doubt the real numbers would have been that high or, after 10 years of payments, that the outstanding debt would have been anything significant.
You are underestimating the amount of people who make very low payments based on their income. My SO can pay off their loan in 5-6 years based on our income, but if they didn’t have a proper job they could make minimum payments and pay off the loan in 25 years. You obviously will pay a lot in interest but people do that if they don’t earn a lot of money or make bad financial decisions.
It’s basic math… you have to have borrowed less than 12K and not missed a monthly payment for 10 years.
There’s no way, given those two conditions, that there’s any significant balance left.
Income based repayments such as SAVE calculate your payments as a percentage of your disposable income. This means it can be as low as $0 per month if you happen to be unemployed for even a short time. Interest still accrues, but doesn’t capitalize with SAVE. This can result in a “significant” balance.
So I’m not going to go into detail. Instead I’m going to ask you to truly challenge your belief here and look into it personally. Consider the interest rates, average wage, rate of inflation, and total cost for rent and other bills. Factor in food and gas costs appropriately.
I say this as someone who has had multiple sub-$12,000 loans and never taken over 10 years to pay off.
That doesn’t matter though. I do celebrate that you have managed to pay off several loans succinctly without defaulting. Sincerely, well done. However, that in no way relates to what I asked.
It’s up to you, of course. No one here can force you. All I did was challenge you to examine what you are certain you know, that’s all.
