The Department of Education announced today a proposal to “to reduce the cost of federal student loan payments, especially for low and middle-income borrowers.” The Department says that the proposed regulations “would create the most affordable income-driven repayment (IDR) plan that has ever been made available to student loan borrowers, simplify the program, and eliminate common pitfalls that have historically delayed borrowers’ progress toward forgiveness.” More specifically, the Department says that the regulations “would amend the terms of the Revised Pay As You Earn (REPAYE) plan to offer $0 monthly payments for any individual borrower who makes less than roughly $30,600 annually and any borrower in a family of four who makes less than about $62,400. The regulations would also cut in half monthly payments on undergraduate loans for borrowers who do not otherwise have a $0 payment in this plan. The proposed regulations would also ensure that borrowers stop seeing their balances grow due to the accumulation of unpaid interest after making their monthly payments.” The press release is here. An “unofficial copy” of the proposed regulation is here, and a fact sheet with further information is here.
The proposal has a 30-day public comment period.