"Last Friday, the Supreme Court dashed hopes of student loan forgiveness for now. Still, the Biden administration announced it would take another swing at the process, using authority from the Higher Education Act to create a debt Forgiveness regulation. The so-called plan B is going to be slower going due to how the Department of Education must go about writing new regulations. At the same time, the administration also released the final details of its new income-driven repayment (IDR) plan, called Saving on a Valuable Education (SAVE), as a way to provide relief to borrowers when repayments restart.

IDR plans are designed to adjust payments based on income, helping protect those with low earnings from unaffordable student loan bills. The new SAVE plan is intended to be more generous than prior IDR options, particularly for those with only undergraduate debt. It will also eliminate negative amortization to prevent balances from growing even when borrowers make payments and make it easier to reach loan forgiveness after years of payments. These new provisions have been long sought by advocates. The regulations creating the new plan do fully go into effect until July 1, 2024, but the Biden administration plans to implement parts of it early," reports Forbes.

Photo: President Joe Biden is joined by Education Secretary Miguel Cardona (L) as he announces new actions to protect borrowers after the Supreme Court struck down his student loan forgiveness plan in the Roosevelt Room at the White HouseGETTY IMAGES