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Financial Services Law Insights and Observations

White House launches SAVE Plan

Federal Issues Biden Student Loans SAVE Plan Consumer Finance

Federal Issues

On August 22, the White House announced the SAVE Plan, an income-driven repayment plan, intended to calculate payments based on a borrower’s income and family size rather than the loan balance and provide forgiveness for balances after a certain number of years since repayment. It is estimated that over 20 million borrowers could benefit from this plan and that it will have particular critical benefits for low- and middle-income borrowers, community college students, and borrowers who work in public service. In order to encourage participation by borrowers, the Department of Education is partnering with grassroots organizations on an outreach campaign. This plan builds on broader actions taken by the current administration to deliver relief to borrowers and make college more affordable.