The Biden administration's plan to wipe out billions of dollars in student-loan debt is in legal limbo, blocked at least temporarily by lawsuits. But a related proposal to lower monthly payments for millions of borrowers is taking a major step forward this week.
The U.S. Department of Education laid out a proposed rule Tuesday to simplify and expand eligibility for its income-driven repayment programs, which tie monthly payments on federal student loans to the borrower's ability to pay.
New borrowers would benefit most from the changes; the administration estimated that future borrowers would see their total payments cut by 40% on average. For Black, Latino, American Indian and Alaska Native borrowers, the administration said, the changes would cut their total payments in half.
