The Brandon jubilee presses on. Income based payment plans are planned to be at a lower pct of discretionary income, the threshold for discretionary income is planned to be higher, and govt will cover/prevent interest from accruing. Obviously not as good as blanket forgiveness, but this is very good to prevent kids/grown kids from being crushed by snowballing debt payments.
And, while this is essentially what was announced last August, it appears at least to more clearly cover grad loans, and this, to my recollection, is the first time that the administration has confirmed continued interest in this policy. Not out of the woods obviously, but an encouraging sign.
Reminder that this shit was always the preferred neoliberal strategy because it goes out the window as soon the Republicans take the Whitehouse again.
could be, but i wouldn't be surprised if the political calculus doesn't result in a one way ratchet. (and, frankly, i'm not sure if borrowers' assent to a change in terms of their loan contract can be unilaterally undone by a future administration.)
One of the first things DeVos did upon joining the DoE was attack Debt Relief and Forgiveness programs. That was less than a decade ago, comrade.
i'd be curious to read the prior policy and in what capacity trump/devos changed it.
Maybe your googling will get better results than mine did, but I can tell you right off the bat:
borrowers’ assent to a change in terms of their loan contract can be unilaterally undone by a future administration
That's not how IBR works. IBR is an assistance program, not a reconsolidation, the terms of your loan don't change, just the handling of repayments. It requires recertification every year; Its the ultimate means testing program and they can easily change the program so that you have to sign up for a different one when it's time to recertify.
If I see another one of these stupid backronyms I am going to SHOOT (See Handsome Opossums Often-Times) myself :possum-mama:
I wish they’d just waive interest, it’s ridiculous to charge interest on federally backed loans
Fuck's sake, stop means testing shit, it will never stick if you keep means testing it. This is so clearly bullshit.
If shit is 'income-based', then it means that some plans are only available based on how small your income is. Cost of living is wildly different around the country, making 60,000 in New York is not the same as making 60,000 in Alabama.
is a progressive income tax means tested? (income based here means your payment is just a function of your income, not that only some income levels qualify jfc.) everyone here qualifies, everyone just pays a function of their discretionary income.
what's the average income of a teacher in nyc vs mobile?
Actually, I read that wrong. I read that as different plans, not as one plan, one scaling rate. Not technically means testing, but still incredibly ineffective as a poverty reduction-education increasing policy.
The average income can be the same, the purchasing power (especially concerning rent) will be quite different depending on region. Average income of a teacher in mobile and nyc are about the same (about 10,000k less a yearin mobile), but rent isn't.
it's clearly less good than blanket forgiveness, but i don't understand how it could be ineffective at poverty reduction. anything under 30k, and the borrower will just never have to make payments and the debt eventually is forgiven. no interest accruing. this would allow kids the opportunity to go to college without worrying that they will become crushed by debt.
i'm seeing a ~20k difference between alabama and nyc for new/low experience teachers (w/ nyc making 50pct more (61 vs 42k), so miss me with those numbers lol-- someone who is good at the economy please help me budget this: i'm spending 6000/month on candles and a lux studio appartment on the upper east side.
That's not what I was seeing, I was seeing 37k low in mobile and 45k low in NYC, but fine, we'll go with your numbers. You're acting like 60k buys anything substantial in NYC, that person will be sharing rent in mid-low level apartments, or have to do an hour commute each way minimum, if they want to save anything for retirement, for their whole lives if they don't get married, and that is assuming the economy works and their investments pay off.
It's ineffective at poverty reduction because everyone I know makes more than 30,000k a year working full-time, and that's fry cooking at McDonald's, which is still poverty wages if you are not trying to live with three other dudes in a shitty apartment for your entire life. There is no material incentive to 'get an education' if, the better you do, the more you have to pay back.
I will say that the really good thing I am seeing here is that interest cannot exceed maximum repayment. That's a small unequivocal blessing. But that is all these things are, pieces of carrot in a pile of shit. Guess it is still better than the shit other people have to suffer from, better than nothing, but treating scraps as a win is just sad.
Any idea how marital status or being claimed as a dependent affects the loan forgiveness?
It's always so fucking hard to find info about that. Want to know if my income will be included in my partner's means-testing
Okay, so I believe this is how it works: Discretionary income is a function of the poverty threshold, and the poverty threshold is a function of household income and size.
The proposal will put the discretionary income threshold at 225% of the poverty threshold. If it's just the two of you, this results in discretionary income at anything over $44,370. So you would all would be paying 5pct of the difference between your net income and discretionary income. And if your net income is less than that $44,370 level, you pay nothing. And in any case no interest accrues, and loans are forgiven after 20 or 25 years of "payments" (no matter the principle).
https://aspe.hhs.gov/topics/poverty-economic-mobility/poverty-guidelines
Thank you so much! That clarifies things tremendously. Do you know if "households" only applies to married couples or does it also also apply to unmarried partners?
sure thing. i'm afraid i might get this wrong, but my sense is that unmarried couples are two separate households for tax or state administrative purposes, except for if one of you is claiming the other as a dependent (which i might infer from your initial question): in such a case, i believe that you are counted as a single household.
Gotcha, yep good inference - thanks for the help understanding what's going on! Tax stuff and money stuff makes my head spin, I really appreciate it
no sweat. hope this goes through and makes things a bit easier.
i'll see if i can figure it, but here's the "fact sheet" in the meantime.
https://www2.ed.gov/policy/highered/reg/hearulemaking/2021/idrfactsheetfin.pdf?utm_content=&utm_medium=email&utm_name=&utm_source=govdelivery&utm_term=
hard to tell if I am understanding it right, but the changes they are going for mean monthly payment for a 1 person household will be capped at
([Your Take Home Per Month] - 2549) x .05
I get 2549 from multiplying the fed poverty of a single person household by 2.25 and then dividing by 12.
articles like this should include the formula and a calculator.
