Student Loan Borrowers Face October Deadlines to Exit SAVE Plan After Court Order
Borrowers enrolled in the SAVE student loan repayment plan faced October deadlines to switch to a new plan after a court order ended the program. The transition has created confusion for millions of borrowers who must now choose from a smaller set of income-driven options.
Millions of student loan borrowers enrolled in the Saving on a Valuable Education plan faced October deadlines to switch to a different repayment plan after a court order ended the program earlier this year.
The SAVE plan, which offered lower monthly payments and faster forgiveness timelines than older income-driven plans, was struck down by a federal appeals court that found the Biden administration had exceeded its authority in designing the program.
Borrowers who had been making payments under SAVE were placed in an interest-free forbearance while the legal battle played out. That forbearance ended for many borrowers in late September, with deadlines to select a new plan falling in October.
The remaining income-driven options include the Income-Based Repayment plan, the Pay As You Earn plan, and the Income-Contingent Repayment plan. Each has different eligibility rules and payment calculations, and borrowers said the process of comparing them has been confusing.
The Department of Education said it was working to process plan-change requests as quickly as possible, but borrowers reported long wait times when calling servicers and delays in seeing their accounts updated online.
The 2027-28 FAFSA also opened on October 1, earlier than in previous years. Financial aid experts encouraged families to file as soon as possible to maximize their eligibility for grants and other aid.
