Shutterstock
Dec. 14, 2022
Kevin Carey was quoted in an article by Inside Higher Ed about alternatives for student loan payment.
While President Biden’s one-time student loan forgiveness plan remains tied up in the U.S. Supreme Court, the Education Department is working on a more far-reaching and costly plan to overhaul how people pay back their loans.
The overhaul of the department’s income-driven repayment program, which bases monthly payments on an individual’s income and family size, would cut payments in half for undergraduates, with a cap of 5 percent on a borrower’s discretionary income. Those who take out $12,000 or less in loans would qualify for relief in 10 years, among other changes. Over all, experts say this plan has the potential to remake how higher education is financed in America—though that depends on whether borrowers take advantage of it.
“The IDR changes are on a much stronger legal footing,” said Kevin Carey, vice president for education policy at New America, a think tank. “The Obama administration has already done this, but no one challenged it in court.”
The legal fight has thus far focused on the one-time debt relief, though Republican lawmakers have criticized the income-driven repayment changes as well.
Read the full article here.