The Biden administration is also looking into a new income-driven repayment plan. That role would cap borrowers' monthly payment at 5% of their monthly discretionary income that's down from 10%. And the government would also forgive balances of $12,000 or less after a borrower has made 10 years of payments down from 20 years right now.
President Biden’s plan to forgive federal student loan debt for millions of Americans has been frozen since a handful of Republican-led states sued to stop it. They argue the president doesn’t have the power to wipe away billions of dollars of debt on his own. It’s now up to the US Supreme Court to decide if they’re right.
Bloomberg Supreme Court correspondent Greg Stohr joins this episode to talk about the arguments on both sides, and where the 6-3 conservative majority might come down. And personal finance reporter Claire Ballentine explains what happens next for Americans with student debt if the court upholds Biden’s plan–or knocks it down.
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