Hours after the Supreme Court overturned President Joe Biden’s executive order canceling student debt on Friday morning, the White House announced several new actions to support student borrowers.
One of the plans is a 12-month “on-ramp” to repayment, where borrowers who miss monthly payments through September 2024 won’t be reported to credit bureaus or go into default. This could shield students who owe money from having their credit ratings ruined for life while they figure out how to fit payments into their budget.
But debt attorney Leslie Tayne, who represents student loan debtors, warns borrowers not to get too excited just yet: the details of Biden’s plan are still up in the air.
“Even though this is something that was discussed today, none of it has been implemented,” Tayne told Charles Feldman and Rob Archer on KNX In Depth. “The reality is, to push anything through in the next 60 days, when payments are due, is probably unrealistic.”
She added that the announcement is “really, really broad,” and it remains to be seen how it will actually be implemented.
Biden made it clear that this plan isn’t the same as the Covid-era student loan pause, which ends in October. During the “on-ramp” period, payments will still be due, and interest will still be accrued.
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