WASHINGTON – President Joe Biden announced new steps Friday aimed at helping borrowers repay student loans after the Supreme Court invalidated his debt relief plan.

Biden outlined new payment options that would be available to millions of borrowers, as well as his administration’s plan to provide broader relief.

The president said that once student loan payments begin on October 1, after a three-year hiatus that began during the Covid pandemic, borrowers will have the opportunity to enroll in a temporary «access payment program.» of 12 months that will eliminate the threat. default

“During this period, if you can pay your monthly bills, you should,” Biden said in brief remarks from the White House. «But if you can’t, if you don’t make payments, this onramp will temporarily remove the threat of default or damage to your credit, which can hurt borrowers for years to come.»

The Department of Education will not refer borrowers who have missed payments to the credit bureaus during this period, Biden said.

«We know that figuring out how to pay these extra expenses can take time for borrowers, and they may lose initial payments as they repay,» he added. «Typically, this can lead to borrowers becoming delinquent and defaulting.»

This plan would be different from the student loan pause started in 2020 by then-President Donald Trump and extended multiple times by Biden. Under that program, which continues for the next few months, no interest has accrued since no monthly payments have been required.

Biden also announced changes to limits on the percentage of discretionary income paid for student debt. In the future, no borrower will be required to pay more than 5% of their discretionary income on undergraduate loans, below the previous limit of 10% each month.

More generally, Biden said, his administration would work to provide student debt relief to «as many borrowers as possible, as quickly as possible» through the Higher Education Act of 1965. Doing so, he said, would allow the secretary of Education, Miguel Cardona, «commit, waive or release loans under certain circumstances.»

The Supreme Court on Friday rejected the Biden administration’s arguments that its student loan plan was legal under a 2003 law called the Higher Education Opportunity Relief for Students Act, or HEROES Act. The law states that the government can provide relief to student loan recipients when there is a «national emergency,» allowing it to act to ensure that people are not «in a worse financial position» as a result of the emergency.

During his remarks, Biden called the Supreme Court’s student loan decision a «mistake» and «wrong.» He also criticized Republicans, saying they couldn’t «bear the idea» of providing relief to working-class and middle-class Americans.

Asked by a reporter if he had given borrowers «false hope» about loan forgiveness, Biden pointed the finger at Republicans.

“I didn’t give the borrowers false hope, but the Republicans took away their hope that it would,” Biden said.