On Monday, the Department of Education launched a Beta website for the Biden administration’s new program which was created as an income-driven plan intended to lower monthly student loan payments and reduce the amount paid back over the lifetime of the loan.
Under the new plan, income and family size will determine the payments for current and future federal student loan borrowers with some payments dropping to zero dollars per month.
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To qualify for zero-dollar payments, the income threshold has been increased from 150% to 225% of federal poverty guidelines, which translates to an annual income of $32,805 for a single borrower or $67,500 for a family of four.
Other borrowers could see their payments cut in half and canceled after at least 10 years of repayment when the program is in full effect next year.
The initiative comes after the Supreme Court’s decision in June, striking down President Biden’s loan forgiveness program.
But, the plan still comes at a cost to the federal government.
Estimates range from $138 billion to $361 billion over 10 years, depending on how many people sign up.
For more information on this program, visit StudentAid.gov.