The Biden Administration tried to eliminate some student debt. But, a federal appeals court stopped the Saving on a Valuable Education Plan (SAVE) from moving forward, while it considers its legality. Instead the eight million people who had enrolled in SAVE still face considerable debt. Oyin Adedoyin reports for the Wall Street Journal on the likely future for these people during a second Trump administration.
Millions of Americans are burdened by student loans, including nearly three million older adults. Older adults also owe more than $54 billion in medical debt. But, relief is nowhere in sight for them or for tens of millions of other Americans with student debt or medical debt.
People with student debt are at a loss as to what to do. Many are part of a public-service loan forgiveness initiative. They expected the balances on their loans to be eradicated once they had made 120 monthly payments. And, they had planned for that future.
People who are part of the SAVE program are in limbo at the moment. They need not pay anything on their loans, and they will not be penalized for doing nothing. But, until the lawsuit ends, they are stuck.
Around a million public-service workers in SAVE thought their monthly loan repayments would come down around $1,000 a year, on average, and, for some, go away entirely. Instead, at least for now, the Biden Administration is only able to help 55,000 public service workers through the Public Service Loan Forgiveness Program.
Many Republican policymakers in the states challenged the SAVE program on the grounds that it is expensive and illegal. Trump has called the program a “catastrophe.”
People in SAVE who have worked in public service for at least 120 months, but who have not made 120 loan repayments yet, could be able to “buy back” the right to loan forgiveness. They might have to pay in more. Or, they could sign up for a different repayment plan based on income.
Here’s more from Just Care:
- Nearly 3 million older adults shouldering student loans
- Debt among older Americans increasing in good part because of health care costs
- Older adults owe $54 billion in medical debt
- Medical debt is a profit center for banks and private equity
- Medical debt more prevalent among Medicare Advantage enrollees than traditional Medicare enrollees
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