Around 8 million student loan borrowers might see their monthly payments double if President-elect Donald Trump dismantles President Joe Biden's repayment plan, according to CNBC.
The borrowers are in the SAVE program that aims to make repayments more affordable. It caps monthly payments at 5% of a borrower’s total income, compared to 10% under the old REPAYE plan.
For the 4 million SAVE borrowers making less than $15 an hour, their monthly payments are reduced to $0. The plan also shortens the repayment period to 10 years from 20 to 25 years for those who borrowed less than $21,000, and cuts interest garnered on student loans.
Using a variety of programs, Biden has canceled $175 billion in student debt for nearly 5 million borrowers, according to Business Insider. But Trump has criticized broad-based student loan forgiveness and called Biden’s student loan relief program “vile” during his campaign. Several Republican-led states have challenged the SAVE plan, arguing that Biden had no authority to implement the “unlawful” program.
Bob Eitel, who served during the first Trump administration as a senior counselor to the education secretary, expects Trump to roll back Biden’s loan relief programs, CBS News reported.
"The Trump administration may pursue different avenues of loan relief, but it will not be the mass, blanket types of forgiveness that the current administration has pursued," Eitel told CBS News.
SAVE has been temporarily suspended due to legal challenges, and the loan repayments are on hold. Unless the Trump administration defends SAVE in court, its enrollees will likely see their payments return to prior numbers.
“For those worried about SAVE going away, I think it probably will, unfortunately,” Betsy Mayotte, president of The Institute of Student Loan Advisors, a nonprofit that helps borrowers navigate the repayment of their debt, told CNBC.
