Benefits of staying on, leaving SAVE Plan as income-driven repayment plans reopen
Experts provided advice for student loan borrowers considering leaving or staying on the SAVE Plan following the reintroduction of online access to income-driven repayment options.
As a result of an injunction on the Biden administration’s student debt relief plan, millions of borrowers in the SAVE Plan have been forced into forbearance, according to a report from Forbes. Although these borrowers will not accrue interest on their loans or be required to make payments during the forbearance period, the time will not count toward their student loan forgiveness. The U.S. Department of Education reopened online applications for income-driven repayment plans; however, the experts cited in the article emphasized that borrowers should weigh reasons to stay or leave the SAVE Plan prior to making a decision.
Those who are considering leaving the SAVE Plan will be able to resume progress toward student loan forgiveness through the Public Service Loan Forgiveness program or income-driven repayment plans as well as maintain more certainty about student loan forgiveness; whereas those considering staying in the plan may have lower student loan repayments compared with income-based repayment options, receive interest subsidy that waives excess interest for some borrowers, have access to applications for the PSLF Buyback program and be able to switch to a 10-year Standard plan or economic hardship deferment.
Read more: Forbes
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