Key Student Loan Deadline Is Approaching for 6 Million Borrowers
Summary
Millions of federal student loan borrowers must choose a new repayment plan by September 29 because the Biden administration’s SAVE plan is ending under the Trump administration. About 1.5 million have already picked new plans, but 6 million more need to act soon to avoid being placed in a plan with higher monthly payments.Key Facts
- The SAVE plan helped lower student loan payments based on income and stopped some interest from growing.
- About 7.5 million borrowers were enrolled in the SAVE plan at its peak.
- The Trump administration ended SAVE after court challenges stopped key parts of the plan.
- Borrowers must select a new repayment plan by September 29 or be automatically put in a standard plan with higher payments.
- Loan servicers started notifying SAVE borrowers on July 1 about the need to switch plans.
- 1.5 million borrowers have already chosen new repayment options.
- The Department of Education is aware of some billing and notice errors during the transition and has worked to fix them.
- Not choosing a new plan could cause financial problems for borrowers because payments may increase significantly.
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