President Joe Biden's administration announces new student loan forgiveness program. (Official White House photo by Adam Schultz)
TOPEKA — For thousands of Kansans knee-deep in student debt, relief will come soon — just not as much relief as initially promised.
The Biden administration announced Tuesday that more than 4 million federal student loan borrowers have been enrolled in the Saving on A Valuable Education, or SAVE, program. In Kansas, 35,000 borrowers are enrolled, according to U.S. Department of Education data.
“Millions of borrowers are already benefiting from enrollment in the SAVE plan, and I’m thrilled to see so many Americans submitting applications every day so that they, too, can take advantage of the most affordable student loan repayment plan in history,” said U.S. Secretary of Education Miguel Cardona in the Tuesday news release.
Cardona emphasized the Biden administration’s focus on student debt relief while speaking at a Topeka public school Tuesday, during the kick-off of his Midwest bus tour.
We’re committed to giving you the tools to make sure you have a good pathway into the profession and that you’re not paying debt for the rest of your life,” Cardona told Kansas students Tuesday.
The new repayment program is a response to the Supreme Court’s June decision to kill the debt relief program unrolled by the Biden administration. The original program would have canceled up to $20,000 in student loan debt for some borrowers. In Kansas, officials estimated that more than 360,000 residents would have received some form of debt forgiveness under the original program.
Federal student loan repayments, which have been paused for more than three years due to the COVID-19 pandemic, will resume in October. As the repayment deadline approaches, the Department of Education has scrambled to roll out several repayment and loan forgiveness programs.
Under SAVE, debt payments are calculated using borrower income and family size, with balances forgiven after a certain time frame. Borrowers who are currently in the Revised Pay as You Earn plan will automatically roll over to SAVE.
A single person who makes less than $15 an hour wouldn’t have to make payments under the program, and most borrowers will save about $1,000 per year under the new plan.
“The new application is easy and quick. Most people only need about 10 minutes to complete it,” said Federal Student Aid Chief Operating Officer Richard Cordray. “Borrowers can get their monthly payment calculated in real time, and they can choose to have their IDR application recertified automatically each year.”
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