8 million student loan borrowers are in for a jarring surprise Aug 1 as Trump admin restarts mandated interest payments

[Yo_Mama_Been_Loggin]

Almost 8 million federal student loan borrowers who enrolled in a Biden-era repayment program will soon see interest accruing on their debt again, even as their payments are paused due to an ongoing legal battle.

Starting Aug. 1, interest will begin accruing on loans that are currently enrolled in the Saving on a Valuable Education, or SAVE, repayment plan, the Education Department announced Wednesday. Some 7.7 million borrowers are enrolled in the plan, which was created under the Biden administration in 2023 and faced immediate backlash from conservatives.

In fact, the future of the SAVE repayment plan has been in legal limbo for months, following a lawsuit brought by seven Republican-led states. While the lawsuit plays out, borrowers enrolled in the plan have not had to make payments, and interest has not accrued. Now, interest will restart, though enrolled borrowers still do not need to make payments, the Education Department says. That means their balance could grow as they wait for the lawsuit to play out—and when forbearance ends, borrowers will be need to make monthly payments on the new, higher loan totals.

The Student Borrower Protection Center, a student loan advocacy group, estimates this will cost the typical borrower $3,500 per year, or $300 per month, in interest payments.

https://www.yahoo.com/news/8-million-student-loan-borrowers-191153933.html

[Johnny2X2X]

1. They screwed over students so many ways

This is terrible for millions of borrowers. Basically they renegotiated the terms of the loan contracts we signed and all of us will pay much much more.

And future students are going to be wrecked too.

[FirstLight]

2. I love how these new stories say that it's going to cost us this much, but they don't

Take into account that many people aren't going to be paying that because they don't have the money! So what's going to end up happening is defaults all over the place. Then what happens?

I know I sure as fuck don't have an extra $300 a month for the government to eat. Fuck them

[Celerity]

3. and some here will jaw-juttingly cheer this on:

'Those lazy, entitled, self-important, deadbeat, kale-chomping, avocado toast-eating Millennial and Zoomer slackers need to get off the couch, stop taking selfies/TikToking and man up/woman up and pay the debts they took on, right on down to the last goddamn cent!'



(and that typology of stance is often accompanied by condescending, moral superiority-laden tales/humble-brags of them working in some 1950s/1960s/1970s part-time time job that the jaw-jutter points to as how they paid off their debt, yet often failing to disclose the staggeringly less total debt they incurred in those now olden times)

[Hugin]

6. Hear, hear!

They also fail to mention that their education was not only vastly cheaper, but it was heavily subsidized by the government via grants in most cases rather than loans.

I have never been sure if they don’t realize this or if they are just that f**king mean.

Of the ladder pulling going on, this student loan horsesh*t is the most pathetic and over time will be the most permanently damaging to the US.

[Xolodno]

5. They can pound salt.

I'm unemployed and less than 10 years from retirement.

This is just going to increase defaults by the default in loans chief. You can't squeeze milk from a rock.

[purr-rat beauty]

7. Fueling up fodder...

For For Profit Debtors Prisons