Key Facts

• The SAVE plan, which helped about 7 million borrowers with low monthly payments, will end, and those borrowers must switch to new options or face automatic moves to standard repayment plans.
• The One Big Beautiful Bill Act replaces multiple income-driven repayment plans with just two: the Standard Repayment Plan and the new Repayment Assistance Plan (RAP).
• The new RAP sets payments between 1% and 10% of a borrower's income, but loan forgiveness will only occur after 30 years of payments, lengthening the repayment period compared to older plans.
• Borrowers with current loans can keep some old plans for now, but most will eventually move to the new system, especially if they take out new loans after July 1.
• The Graduate PLUS loan, which let graduate students borrow up to the full cost of attendance, will no longer be available starting July 1.
• New borrowing limits will restrict how much students can take out in federal loans.
• The Education Department stated that the SAVE plan was implemented without proper congressional approval and faced legal challenges.
• Loan servicers will start sending 90-day notices to SAVE plan borrowers soon to inform them of the changes.