Savings Opportunity and Affordable Repayment Act

Key Points

• The bill creates a new income-based student loan repayment plan called the Savings Opportunity and Affordable Repayment (SOAR) plan. Borrowers earning under 250% of the federal poverty level would owe $0 per month, shielding the lowest earners from any payment burden.
• Monthly payments above the income threshold are capped at 5% of discretionary income for undergraduate loans and 10% for graduate or professional loans, keeping bills tied to what borrowers can actually afford.
• The government would stop charging interest that a borrower's monthly payment doesn't cover, preventing loan balances from ballooning over time — a major pain point for current borrowers.
• Remaining loan balances would be forgiven after 10 years of payments for borrowers with short-term undergraduate loans (2 years or less of study), and after 15 years for all other borrowers — significantly faster than the current 20-25 year timelines.
• Older income-driven repayment plans like PAYE and ICR would be phased out over two years. Borrowers already enrolled could stay, but new enrollment and re-enrollment would be blocked after the transition period.
• Married borrowers who file taxes separately — or who are separated or can't access their spouse's income — can have payments calculated using only their own income and loan debt, giving couples more flexibility.

Votes

No votes have been recorded for this legislation yet.