Student loan borrowers could be forced into 'unthinkable financial decisions' if Supreme Court rules

[Celerity]

against Biden

Plan for the worst and pray for the best with these student loans.



https://www.reckon.news/news/2023/02/student-loan-borrowers-could-be-forced-into-unthinkable-financial-decisions-if-supreme-court-rules-against-biden.html



Pinching pennies and starting a student loan debt repayment plan could soon be the reality for federal student loan borrowers. The U.S. Supreme Court will hear two arguments – one case from six Republican-led states and another brought by two borrowers in Texas coming up on Feb. 28. These cases could determine the fate of President Biden’s student loan forgiveness plan. If the high court strikes down the plan, borrowers will have to re-start repaying their federal student loans this year.

“Should payments resume this year, borrowers will be forced to make unthinkable financial decisions like whether or not they can save for retirement, start a family or put food on the table,” Braxton Brewington, press secretary of The Debt Collective, a debt-elimination advocacy group told Reckon. Nearly 26 million Americans who applied for relief are now in limbo, hoping justices will uphold Biden’s plan of canceling $10,000 to $20,000 in student loan forgiveness. If SCOTUS blocks the student loan forgiveness plan, determining next steps for repayment should be at the top of federal borrowers’ lists. Here are a few ideas to consider:

What to know about a repayment plan

Repaying student loan debt is different for every borrower, especially when more than 40 million Americans have benefitted from not having to pay on them for the past three years. A common option for borrowers before the pause was selecting an income-driven student loan repayment plan. By visiting StudentAid.gov or providing income verification to a loan servicer, federal student loan borrowers can set up a repayment plan based on their income.

With student loan payments set to start either 60 days after SCOTUS makes a decision, or 60 days after June 30 (when the pause ends), higher education experts like Mark Kantrowitz have told USA Today, “Sixty days will be enough to forgive student loan debt if the president’s plan survives.” In the event Biden’s forgiveness plan doesn’t survive, he has a newly proposed income-driven repayment plan. This plan is meant to prevent borrowers from getting overloaded with debt by either lowering monthly payments or effectively pausing them, making payments more affordable and manageable.

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Read more: ‘Student debt is morally illegitimate

[underpants]

1. Well if it goes through (which I doubt) it'll knock most

of my balance out. I may look into a loan to pay it off and get away from the daily compounding of interest.

[maxsolomon]

2. Um... wait a minute...

Pinching pennies and starting a student loan debt repayment plan could soon be the reality for federal student loan borrowers.

Isn't that where we were BEFORE the Pandemic? That's what I did to pay off my student loans.

[Celerity]

3. How long ago did you take out the loans and when did you pay them back? I ask because the

average total cost of a public, instate bachelors degree at a 4 year uni has been over 100,000 USD (NOT even counting interest and loss of income) since 2019 or so.

Plus the cost of living, especially rent/mortgage (and other prices as well) is so much higher now than longer ago.


Average Cost of College & Tuition

https://educationdata.org/average-cost-of-college

[maxsolomon]

4. It's not really relevant to my point, but over a quarter century ago.

I consolidated the loans with the Fedrul Gubmint (a repayment plan), and pinched pennies until they were paid off. 40K's worth.

I recognize what you're saying about current costs, but that sentence makes it sound like borrowers were anticipating never having to pay the loans back. That can't be universally true.

My daughter wants loan forgiveness to go through for her, but she wasn't planning on it prior to the Pandemic.

[Celerity]

5. student loan debt relief and/or forgiveness has been a goal since long before the pandemic

Good luck to you and your daughter!

[MichMan]

6. Wonder how expensive costs would become if this happened?

Canceling student loan debt is not the fix to reforming higher education. This authority (of the president) is not a one time use, either. If President Biden wanted, he could commit to canceling federal student loan debt at the end of every semester, so we would never have it again.

Anyone who didn't borrow the maximum possible amount allowed would be an idiot.

[ForgedCrank]

7. The loans

themselves have played a big role in driving the costs of education to the ludicrous levels that are now.
As the chances of borrowing and never having to pay it all back rise, expect the tuition and everything else to rise in unison, because that is what is going to happen. The entire system is a scam, just like health insurance and medical costs.

[MichMan]

8. Colleges will be laughing while counting all the money, while taxpayers ger stuck with the bill

I have seen no legislation or proposals regarding making college cheaper. Students won't care because they won't be the ones' paying for it. In fact, the more colleges charge, the student figures they are making out even more.

If I was told that my car loans were being forgiven, I'm sure not planning on buying a Kia instead of a Porsche.

[ForgedCrank]

10. Exactly.

It's unfortunate, but that is how it works.
The entire student loan thing is no less predatory than the mob loan sharks, and it's lower income folks who get hurt the most.

[liberal_mama]

9. I'm not sure how people will manage with the high prices of rent, food, gas, ect

A lot of people have it tough right now.

[GoodRaisin]

11. If I was forced to choose between putting food on the table or paying a student

loan payment, too bad for the lender. Not a very difficult choice.

Seriously, I’ve long considered this as DOA when it gets to the Republican SCOTUS court. I’d be shocked if they didn’t kill it.

[WarGamer]

12. Can Congress make ALL STUDENT LOAN debt subject to bankruptcy filing?

Might be a good avenue?

[MichMan]

13. Of course they could.

They also could have passed loan forgiveness and the SC wouldn't even have a case to review. So far they haven't done either.

[WarGamer]

14. I think dismissing student loans via BK is more palatable to more people...

Forgiveness is a Constitutional stretch and it's a hot button issue even among a LOT of Democrats.

49% of Independents oppose it.

Of the general population, only 43% approve of loan forgiveness.
(nbc poll 9/22)

[MichMan]

15. Depends on who is filing

Someone who is just overwhelmed and can't possibly pay it back, is completely different than a recent graduate who borrows the max, declares bankruptcy shortly after graduation, gets all debts discharged, and then goes out and gets a six figure job on Wall Street or for a big Law firm.

Doubt the level of support for the latter would be very high.