President Joe Biden’s plans to forgive some federal student loan debt and revamp income-driven repayment are “modestly credit positive” developments for the higher education sector, according to Moody’s Investors Service.

Plans to forgive large portions of student debt allow borrowers more flexibility to reenroll in college in order to finish degrees or seek additional education, Moody’s said in a Thursday commentary.

Biden’s plans for income-driven repayment will have a greater effect on the sector because they could boost higher education’s long-term affordability, supporting demand for college and students’ ability to access it, Moody’s said.

In addition, an earlier timeline for debt forgiveness under income-driven repayment could give borrowers with undergraduate debt the ability to seek graduate education and terminal degrees earlier than they would otherwise.

Still, enrollment growth from the income-driven repayment changes is tied to how effectively it is put in place, Moody’s said.

Read the full article about income-driven repayment changes by Rick Seltzer at Higher Education News.