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☆ Meet a 52-year-old who has struggled to repay their $480,000 in student debt on income-driven plans and has pushed off retirement: 'This is an albatross around my neck for the rest of my life'
▼ + stars: | 2023-01-22 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +7 min

Angel, a 52-year-old student-loan borrower, has $480,000 in student debt. Their debt has surged due to payments on income-driven repayment plans and ballooning interest. Biden announced reforms to those repayment plans, but it's unclear how they will be implemented. "And I know that that's a concern for a lot of people I know with student loans." "If education is really about us being better contributors to society, then why are they charging interest on the student loans?"

☆ 3 signs Biden's Education Department has not 'efficiently or effectively' taken steps to overhaul the student-loan repayment system, according to the inspector general
▼ + stars: | 2023-01-19 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

The Education Department plans to revamp the student-loan servicing system. But a report from the Inspector General found it has not been preparing to do so effectively. Last week, the Education Department's Office of Inspector General released a report analyzing Federal Student Aid's (FSA) efforts to transition the current repayment system to a new one, known as Next Generation (Next Gen) Loan Servicing. Additionally, it recommends that FSA develop a policy that requires a budget request be completed and approved prior to moving forward with any changes to the student-loan servicing system. The exact timeline for when borrowers will experience the revamped student-loan servicing system is unclear at this point, especially as the administration is working to implement other significant changes.

☆ What student-loan borrowers should know about Biden's new debt relief proposals — and why advocates argue they're not enough
▼ + stars: | 2023-01-16 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +7 min

Biden proposed reforms to income-driven repayment plans for student-loan borrowers. "Today the Biden-Harris administration is proposing historic changes that would make student loan repayment more affordable and manageable than ever before," Education Secretary Miguel Cardona said in a statement. Here's what you need to know about these proposed reforms, and why some advocates are still pushing for further relief. This revision mean that the department will also be phasing out other versions of income-driven repayment plans. If you have a federal graduate or undergraduate student loan, who will be eligible for these reforms.

☆ Biden's Education Department just proposed a new way to make monthly student-loan payments 'more affordable and manageable than ever before'
▼ + stars: | 2023-01-10 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +5 min

The Education Department unveiled additional details of its reformed income-driven repayment (IDR) plan. It would amend the REPAYE plan by cutting undergraduate student loan payments in half and prevent interest capitalization. One of those programs is the income-driven repayment (IDR) plan, which is intended to give borrowers affordable monthly payments based on their discretionary income with the promise of loan forgiveness after at least 20 years. "Today the Biden-Harris administration is proposing historic changes that would make student loan repayment more affordable and manageable than ever before," Education Secretary Miguel Cardona said in a statement. Rather than creating an entirely new plan, as a fact sheet said, the department will amend the Revised PayAs You Earn (REPAYE) plan, which was created in 2016 to calculate borrowers' monthly payments based on their discretionary income.

☆ If the Supreme Court strikes down student-loan forgiveness, it could have 'startling implications,' Biden says — and set a strange legal precedent going forward
▼ + stars: | 2023-01-08 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +6 min

Biden's administration filed its full legal defense of its student-debt relief plan to the Supreme Court. Student-loan company MOHELA is central to the lawsuit filed by six GOP-led states. The DOJ said that ruling in favor of the states' argument could set a strange legal precedent. She added that the states' standing is questionable, and she's concerned of the legal precedent it would set should the Supreme Court rule in their favor. Should the Supreme Court rule in favor of the states, it would have "startling implications," the filing said.

☆ What millions of student-loan borrowers need to know as 2023 shapes up to be a year of uncertainty for Biden's relief
▼ + stars: | 2023-01-02 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +7 min

Student-loan borrowers are facing a year of uncertainty in 2023. Broad student-debt relief is up in the air as the Supreme Court will make a decision on its legality. The other lawsuit was filed by two student-loan borrowers who sued because they did not qualify for the full $20,000 amount of debt relief. Student-loan payment resumptionWhen federal borrowers resume payments is entirely dependent on how the legal challenges play out. Reforms to targeted loan forgiveness programsThe summer of 2023 should bring borrowers some changes to specific student-loan forgiveness programs.

☆ Don't pay off your student debt in January, Biden's Education Department says: 'Millions of borrowers would be making payments they may not owe'
▼ + stars: | 2022-12-22 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +3 min

The Education Department told borrowers in an email they are not required to resume payments in January. Before Thanksgiving, the department announced another extension of the payment pause. "You will NOT have to make your loan payments that would have been restarted in January," the department wrote in the email reviewed by Insider. "Millions of borrowers would be making payments they may not owe, or payments that are higher than they should be, under the Biden-Harris debt relief plan. On February 28, the Supreme Court will begin hearing arguments on the two separate lawsuits that have blocked the relief.

☆ Biden's student-loan forgiveness 'does not go far enough' for seniors and people with disabilities facing 'crippling debt,' a Democratic lawmaker says
▼ + stars: | 2022-12-19 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

A group of Democrats introduced a bill to wipe out student debt for Medicare and Social Security Disability Insurance recipients. Rep. Jamaal Bowman said Biden's broad debt relief "does not go far enough" to help those borrowers. Social Security benefits risk being seized if a borrower falls behind on student debt payments. More than three million Americans over 60 collectively owe more than $86 billion in student loans, per the Consumer Financial Protection Bureau. Social Security benefits are also at risk of seizure if a borrower defaults on paying their student loans.

☆ Student-loan borrowers who are behind on payments can avoid facing collections for one year after the payment pause ends. Here's how Biden's Education Department wants to make sure companies holding t
▼ + stars: | 2022-12-05 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +3 min

introduced its "Fresh Start" plan, which would help defaulted student-loan borrowers. Last week, the department released updated guidance to the agencies that hold those borrowers' debt. Borrowers will have one year after payments resume to make use of the program. According to Cordray's guidance, the agencies that hold defaulted student-loan borrowers' debt will be required to suspend collection attempts for borrowers in the Fresh Start program for a year following the end of the payment pause. Along with guidance to the guaranty agencies, borrowers in default will also need to take action to return to good standing.

☆ 9 million student-loan borrowers got an email in November with the wrong subject line informing them their debt relief has been approved. Corrections are coming.
▼ + stars: | 2022-12-03 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

9 million student-loan borrowers received an email in late November with a subject line that their debt relief had been approved. It should have stated the applications had been received, not approved — an error made by an Education Department contractor. However, that subject line was incorrect, Insider has learned — it was simply supposed to inform borrowers that their applications had been received with the subject line: "Update on Student Loan Debt Relief." The department has previously indicated that 26 million student-loan borrowers had already submitted applications for debt relief. "Our student debt relief program is necessary to help 40M eligible Americans struggling under the burden of student loan debt recover from the pandemic," Education Secretary Miguel Cardona wrote on Twitter on Thursday.

☆ Student-loan borrowers should not be 'scammed out of an education and into a mountain of debt,' 3 Democratic lawmakers say. Here's how their new bill would help prevent that.
▼ + stars: | 2022-12-01 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

Three Democratic lawmakers introduced a bill to increase oversight of for-profit colleges. The bill would create a committee to oversee the industry and monitor potential predatory behavior. For-profit schools have come under scrutiny for loading students up with debt they cannot pay off. "We cannot let this industry continue to take advantage of students without proper federal oversight." Along with Democratic lawmakers, President Joe Biden's Education Department has taken steps to increase oversight over the for-profit industry.

☆ Student-loan borrowers defrauded by Corinthian were promised $5.8 billion in relief 'immediately.' 6 months later Biden's Education Department says it'll take 'some time.'
▼ + stars: | 2022-11-25 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +6 min

In June, the Education Department approved a $5.8 billion loan discharge for former Corinthian students. Six months later, borrowers are still waiting, and the department said relief will now take "some time." Education Secretary Miguel Cardona said at the time that the impacted Corinthian borrowers will see their loans "immediately forgiven." This prompted Biden's Education Department to reform the process. Still, aside from the June announcement of relief, none of the Education Department's recent actions are giving Corinthian borrowers any certainty.

☆ 200,000 student-loan borrowers were just granted $6 billion in debt relief after a federal judge approved a settlement with Biden's Education Department
▼ + stars: | 2022-11-17 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

A federal judge granted final approval of a settlement involving defrauded student-loan borrowers. 200,000 borrowers are expected to get $6 billion in debt relief, and the department will review other pending claims. The 2019 lawsuit was filed in response to a backlog of borrower defense claims that hadn't been processed. The Secretary's improper delay and suspension of processing claims for debt relief has directly led to a specific economic injury to each class member. "It immediately delivers certainty and relief to borrowers who have been waiting years for a fair resolution of their borrower defense claims," she added.

☆ Biden's administration just made it easier for student-loan borrowers to get rid of their debt in court
▼ + stars: | 2022-11-17 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +6 min

The Education and Justice Department released new guidance on bankruptcy for student-loan borrowers. The guidance gives federal borrowers an easier path to relief by making the process more transparent. On Thursday, President Joe Biden's Education and Justice Departments released new guidance on the pathway for student-loan borrowers to get rid of their debt through bankruptcy. While the undue hardship standard still exists, it's an improvement in that the clear guidelines will allow for consistent treatment of loan discharges. It also gives the Justice Department clear standards for recommending relief to the judge without having to go through time-consuming investigations, per the press release.

☆ Biden's Education Department says it's 'examining' extending the student-loan payment pause to remedy the 'significant confusion' among borrowers after federal courts blocked debt relief
▼ + stars: | 2022-11-16 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

The Education Department said it is "examining" extending the student-loan payment pause. This comes after two federal courts blocked the department from implementing debt relief. "Most borrowers have been told that all they need to do is submit an application to obtain one-time student loan debt relief. Now, as a result of litigation they are left to wonder when, if at all, if debt relief will be effectuated. Advocates and some Democratic lawmakers have been amplifying their calls to extend the payment pause in recent days.

☆ Why a federal court blocked Biden's student-debt cancellation even after a major loan company undermined a key argument in the GOP-led lawsuit
▼ + stars: | 2022-11-15 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

The 8th Circuit blocked Biden's student-debt relief in response to a lawsuit filed by six GOP-led states. It said the states' argument that the relief would hurt student-loan company MOHELA has standing. But a district judge previously dismissed that argument, and MOHELA said it wasn't involved in the case. This was in response to a lawsuit filed by Missouri and five other Republican-led states who argued the loan forgiveness would hurt the states' tax revenues, along with that of Missouri-based student-loan company MOHELA. "This unanticipated financial downturn will prevent or delay Missouri from funding higher education at its public colleges and universities."

☆ Biden's Education Department 'will hold onto' student-loan borrowers' debt cancellation applications so it can 'quickly process their relief once we prevail in court,' the White House says
▼ + stars: | 2022-11-11 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

The White House said the Education Department will hold onto borrowers' information during this time. The administration is appealing the decision and is confident its debt relief will prevail in court. But Biden's administration remains confident in its authority to discharge millions of borrowers' student loans. In a statement after the ruling, White House Press Secretary Karine Jean-Pierre said that "we strongly disagree with the District Court's ruling on our student debt relief program and the Department of Justice has filed an appeal." But the law is on our side and we will keep fighting for the millions of Americans with student debt."

☆ Biden's Education Department just shut the door on new student-loan relief applications following a court ruling
▼ + stars: | 2022-11-11 | by ( Sam Tabahriti | ) www.businessinsider.com time to read: +2 min

Biden's Education Department has stopped accepting applications for student-loan forgiveness. The announcement came after a US District judge ruled on Thursday that the debt relief program was illegal. "Courts have issued orders blocking our student debt relief program," according to a note on the forgiveness application page. The Education Department said in a statement following the ruling that the Department of Justice has filed an appeal. Cardona added: "Amidst efforts to block our debt relief program, we are not standing down."

☆ Student-loan companies are 'ready to apply' debt cancellation to borrowers' balances, Biden's Education Secretary says
▼ + stars: | 2022-11-07 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

Miguel Cardona said student-loan companies are "ready to apply" debt relief. But they cannot actually cancel any student debt right now because the plan continues to be stalled. That's due to a ruling from the 8th Circuit in response to a GOP-led lawsuit seeking to halt the relief. "Unfortunately, our ability to process loan forgiveness has been paused," Cardona wrote. "We believe strongly that the lawsuits are entirely meritless, and that the debt relief plan is lawful and necessary," he added.

☆ A key benefit for student-loan borrowers in public service just expired. Here's what happens now.
▼ + stars: | 2022-11-01 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +3 min

The Public Service Loan Forgiveness waiver expired on October 31. Last October, President Joe Biden's Education Department announced reforms to the Public Service Loan Forgiveness (PSLF) program, which forgives student debt for government and nonprofit workers after ten years of qualifying payments. Well instead, today we are announcing permanent changes to reduce the red tape and the confusing rules that riddle the PSLF program." Part of those changes included a one-time account adjustment to borrowers enrolled in PSLF, along with income-driven repayment plans, to resolve any mistakes on borrowers' payments to date. Beyond that adjustment, PSLF borrowers can expect to see improvements to the program starting next summer.

☆ Biden's Education Department just released its 'monumental' plans to make student-debt payments cheaper for borrowers and streamline targeted loan forgiveness programs
▼ + stars: | 2022-10-31 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +6 min

The Education Department released final plans to improve student-loan forgiveness programs on Monday. "We're also protecting borrowers from higher costs by limiting the practice of tacking unpaid student loan interest onto their principal balances." Improvements to targeted loan forgiveness programsBorrower defense to repayment. Public Service Loan Forgiveness. Preventing interest from spiralingIn July, the Education Department previewed its plan to tackle surging interest.

☆ 2 groups of student-loan borrowers need to take action to get expanded loan forgiveness benefits
▼ + stars: | 2022-10-26 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

The Education Department announced permanent fixes to the Public Service Loan Forgiveness program. It came just days before the PSLF waiver, which expands relief, expires on October 31. As the Education Department announced on Tuesday, though, the waiver may be expiring but reforms will not end there. Borrowers with federal loans that are not direct or managed by the Education Department. To qualify for the PSLF one-time account adjustment, borrowers must have a federal direct loan or a Federal Family Education Loan (FFEL) managed by the department.

☆ Biden's Education Department just announced permanent steps to bring student-loan borrowers in targeted forgiveness programs closer to debt relief
▼ + stars: | 2022-10-25 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +5 min

The Education Department announced permanent fixes to the Public Service Loan Forgiveness program. This comes just days before the PSLF waiver expires on October 31 and isn't being extended. Nearly one year ago, the Education Department announced reforms to the Public Service Loan Forgiveness (PSLF) program, which is intended to forgive student debt for government and nonprofit workers after ten years of qualifying payments. "Today, we're encouraging public service workers to take advantage of the program's temporary changes before the deadline on October 31," Education Secretary Miguel Cardona said in a statement. Although the PSLF waiver is soon expiring, the account adjustment will give borrowers one more chance to get their payment counts corrected.

☆ It's about to get easier for government and nonprofit workers with student debt to get loan forgiveness even though the waiver expires in 6 days. Here's what you need to know.
▼ + stars: | 2022-10-25 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +5 min

The Education Department announced permanent fixes to PSLF after the waiver expires on Oct. 31. President Joe Biden's Education Department announced temporary reforms in October 2021 to the Public Service Loan Forgiveness (PSLF) program, which intends to forgive student debt for government and nonprofit workers after ten years of qualifying payments. Well instead, today we are announcing permanent changes to reduce the red tape and the confusing rules that riddle the PSLF program. How these changes will work with the PSLF waiverBorrowers who apply for the PSLF waiver by the October 31 deadline will have their payments credited under the waiver. Along with these changes, the department still recommends borrowers take advantage of the PSLF waiver before it expires by checking their eligibility here.

☆ U.S. student test results document pandemic's toll on learning
▼ + stars: | 2022-10-24 | by ( Rami Ayyub | ) www.reuters.com time to read: +3 min

Register now for FREE unlimited access to Reuters.com RegisterIn reading, scores declined for most jurisdictions, though the decreases were not as dramatic as those in math. Eighth-graders' math proficiency scores dropped by seven percentage points compared with 2019, results showed. The test is considered to be the first comprehensive, nationwide account of student performance since the onset of the pandemic. Biden's education secretary, Miguel Cardona, described the test results as "appalling" but said they were a call for action. Among fourth graders, white students saw a three-point decrease in math, while Black and Hispanic students each saw decreases of seven points, the results showed.

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