These student loan borrowers will see their monthly bill drop to $0 under Biden’s new SAVE plan

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Dikushin | Istock | Getty ImagesHere’s what else to know.Many borrowers’ bills will be cut in halfThe SAVE plan is an income-driven repayment plan that can cut borrowers’ monthly payments in half, according to the Education Department.Some of the benefits of the plan won’t fully go into effect until next summer, due to the timeline of regulatory changes.Instead of paying 10% of their discretionary income a month toward their undergraduate student debt under the previous Revised Pay As You Earn Repayment Plan, or REPAYE, borrowers will eventually be required to pay just 5% of their discretionary income. The reduction in payments on undergraduate loans to 5% from 10% of discretionary income will be available to borrowers in July 2024, when the SAVE plan is fully implemented.At that point, borrowers who have both undergraduate and graduate loans will pay a weighted average between 5% and 10% of their income based upon their original principal balances, the Education Department said.But borrowers who enroll now in the SAVE plan — or before bills restart in the fall — should see certain benefits sooner.New payment amounts could kick in by fallMost borrowers who apply for the SAVE plan by mid-August should see their new monthly payment …

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