President Joe Biden's student loan forgiveness plan could be given a huge boost if a new proposal is approved by lawmakers in the Senate.
Democratic lawmakers have endorsed plans to codify the Saving on a Valuable Education (SAVE) student debt repayment plan so that it cannot be overturned by future officials.
The Codifying SAVE Plan Act was first introduced in 2023 by New York Rep. Dan Goldman, and has now been endorsed by Senate lawmaker Kirsten Gillibrand, along with 13 other Democratic senators.
Introduced in August 2023, the SAVE plan offers student loan repayments based on income and family size, often meaning payments are lower than they would be without the scheme.
Repayments are calculated as a percentage of a person's discretionary income, or the difference between a borrower's gross annual income and 225 percent of the federal poverty line for a family of their size.
Those who earned under the poverty line have their payments lowered to zero per month, and anyone enrolled who took out $12,000 or less in federal loans and have been repaying for a decade had their remaining student debt cancelled. As of January 12, the plan had 6.9 million borrowers enrolled. It can only be used with federal student loans.
"The SAVE plan is the most affordable student loan repayment plan in history and a lifeline for millions of borrowers—allowing them to live without the burden of exorbitant monthly payments hanging over their heads," Democratic Sen. Kirsten Gillibrand said in a press release issued on April 2. "The Codifying SAVE Plan Act would ensure that the SAVE Plan remains in place and safeguards a much-needed path to federal student loan forgiveness."
The act is likely to pass in the Democrat-controlled Senate, but is already facing hurdles raised by Republican lawmakers. A federal lawsuit, led by Kansas Attorney General Kris Kobach and involving 11 GOP-led states, is seeking a temporary injunction to block SAVE.
Read more: Student Loan Forgiveness Updates
Republicans argue that SAVE is too similar the Biden administration's previous loan forgiveness plans which were struck down by the Supreme Court in 2023. "In completely brazen fashion the president pressed ahead and implemented another version of the student loan forgiveness program," Kobach said of the SAVE plan.
Attorney generals from Nebraska, Iowa, Texas, Alabama, Alaska, Idaho, Louisiana, Montana, South Carolina and Utah are all involved in the lawsuit.
According to a statement seen by The Washington Post, the Biden administration said it "has been fighting to fix a broken student loan system, and part of that is creating the most affordable student loan repayment plan ever.
"The Biden-[Vice President Kamala] Harris administration won't stop fighting to provide support and relief to borrowers across the country—no matter how many times Republican elected officials try to stop us."
Newsweek has contacted the White House for comment via email.
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