December 5, 2023


In a significant response to the Supreme Court’s rejection of the president’s student loan forgiveness plan, the Biden administration has unveiled a comprehensive approach to provide much-needed relief to student loan borrowers. The new initiatives aim to ease the financial strain faced by millions of borrowers and offer alternative paths to debt relief. This blog post will delve into the key components of the plan and their potential impact on borrowers.

Debt Relief Under the Higher Education Act:

The Biden administration seeks to provide debt relief under the authority of the Higher Education Act of 1965. The regulatory process has been initiated to create “an alternative path to debt relief” for working and middle-class borrowers. While specific forgiveness plan parameters have not been detailed yet, the administration’s goal is to address the needs of those most affected by the student debt crisis.

Temporary On-Ramp Repayment Program:

As borrowers prepare to restart their student loan payments in October, the administration has introduced a 12-month on-ramp repayment program. During this period, borrowers won’t be penalized for late or missed payments. Interest will still accrue, but it will not capitalize at the end of the on-ramp period. This program provides a grace period for borrowers to regain their financial footing without facing credit penalties or default.

The Most Affordable Repayment Plan in History:

The administration has finalized the Saving on a Valuable Education (SAVE) plan, an income-driven repayment plan designed to alleviate the burden on borrowers. This plan aims to cut borrowers’ monthly payments in half and even allows some borrowers to pay $0 in monthly payments based on their discretionary income. The plan also shortens the forgiveness timeline to 10 years for borrowers with original loan balances of $12,000 or less.

Key Features of the SAVE Plan:

  • Borrowers contribute a maximum of 5% of their discretionary income towards undergraduate loans, down from 10%.
  • Borrowers making less than 225% of the federal poverty level won’t have to make any monthly payment.
  • Balances will be forgiven after 10 years of payments for qualifying borrowers with lower loan amounts.
  • Unpaid monthly interest will not be charged, preventing balances from growing even for those with $0 monthly payments.


The Biden administration’s multi-faceted approach to student loan relief is a clear commitment to addressing the student debt crisis. By pursuing avenues under the Higher Education Act, introducing the on-ramp repayment program, and finalizing the SAVE plan, the administration aims to ease the financial burden faced by student loan borrowers.

These initiatives offer hope to millions of borrowers struggling to manage their student loan repayments, providing them with temporary relief and more manageable repayment options. As the regulatory process progresses and the new repayment plan takes effect, borrowers can look forward to a potentially brighter and more stable financial future.

President Biden’s statement that they will not waste any time on this issue shows their determination to find the best possible path for student loan relief. Education Secretary Miguel Cardona’s assurance that they will never stop fighting for borrowers underscores the administration’s commitment to supporting those burdened by student debt.

In conclusion, the Biden administration’s student loan relief plan represents a step towards a more accessible and equitable higher education system, easing the financial strain on borrowers and promoting a brighter future for all.

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