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News Brief

Oct. 1, 2023 |  By: Farah Siddiqi - Public News Service

Missouri community healthcare centers face 340B uncertainty

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By Farah Siddiqi - Public News Service

The U.S. Department of Education says more than 4 million Americans have enrolled in the Biden administration's college loan repayment program, known as SAVE.

In Iowa, borrowers who meet a lower income threshold can now qualify to reduce or eliminate their payments.

The SAVE program bases borrowers' loan repayments on their discretionary income - the money remaining after buying basic necessities. And it increases the amount of income that's protected from student loan repayment obligations.

The plan could eliminate some borrowers' debt completely, and others could save as much as 40% a month. Robert Farrington - founder of the financial website The College Investor - said so far in Iowa, nearly 40,000 borrowers have applied.

"However, Iowa has over 465,000 student loan borrowers," said Farrington. "So, only about 8.5% of Iowans have actually applied that are eligible. So, there is a lot of room to grow in Iowa as well. "

After a three-year hiatus, student loan payments will resume next Sunday.

In addition to the SAVE program, Iowa offers additional student loan relief programs. Opponents argue that canceling that debt comes at the expense of American taxpayers.

Farrington said there have been income-driven repayment plans in the past, but none with rates as aggressive as the SAVE program's.

Most calculate discretionary income using 225% of the Federal Poverty Level. The SAVE program uses 150%.

"What this means for borrowers is those with low incomes, and those with larger families, will see lower payments," said Farrington. "And some people could see payments as low as $0 a month."

Critics of the SAVE plan say it burdens taxpayers with student loan debt they didn't incur. Others have called it a "slap in the face" to Americans who worked multiple jobs to pay for college.