Just over a month since the Biden administration announced its revamped student loan relief plan, approximately 404,500 borrowers in the Carolinas and Georgia have enrolled in the federal SAVE (Saving on a Valuable Education) program.
That’s about 10% of the total number of enrollees nationwide, the White House stated Tuesday.
According to state-by-state breakdowns from the U.S. Department of Education, 81,600 South Carolina borrowers have enrolled since it was announced on June 30. Another 144,300 North Carolina borrowers and 178,600 Georgia borrowers have joined them.
Undersecretary of Education James Kvaal said in a press call Tuesday that some lower-income borrowers might not have to make payments at all.
“We are implementing the SAVE repayment plan in two phases,” Kvaal said. “This summer we are ensuring that borrowers make no payments if they earn less than about $15 an hour, or more if they have families.”
Most borrowers enrolled in SAVE can expect to save about $1,000 a year, he said.
Kvaal also said “we’re making sure that interest doesn’t grow for borrowers who are making payments every month.”
Ballooning interest, even with regular monthly payments on student loans, has long been a problem, especially for borrowers of color.
“Student debt is an issue that has very stark racial disparities,” Kvaal said. “Black borrowers typically have not paid down anything on their student loans after 10 years.”
According to numbers compiled last year by the Urban Institute, 16% of white student loan borrowers in South Carolina are in debt, and they, on median, owe a little more than $22,000 on their student loans.
By comparison, the numbers for borrowers of color are 20% and a little over $24,000, respectively.
Such disparities are exaggerated by several factors, including uneven college graduation rates between white borrowers and borrowers of color, and the fact that borrowers of color usually borrow more money to go to college in the first place.
Kvaal said the Department of Education and Biden administration are trying to address these kinds of disparities through SAVE and other relief efforts.
The second phase of SAVE will be rolled out next summer, Kvaal said. In Phase 2, the percentage of income to be earmarked for repayment is set to drop from 10 to five.
According to EducationData.org, 731,500 student loan borrowers live in South Carolina, owing more than $29 billion dollars. More than 14% of state residents have student loan debt, one of the highest rates in the country.
