"The Trump administration's Department of Education announced on Tuesday that millions of borrowers who are enrolled in the Saving on a Valuable Education (SAVE) plan may soon need to select a new repayment plan, part of a settlement with the state of Missouri. If approved, the move could force millions of Americans to repay their federal student loans, ending the current pause in payments and interest aimed at student debt relief, a holdover from the Biden administration."
"SAVE is a popular federal student loan income-driven repayment plan (IDR), which caps, or puts a maximum limit, "on how much borrowers must may monthly federal student loan bills at a portion of their income, and it forgives remaining debt after a set number of payments, according to Nerd Wallet. SAVE has been in legal limbo since February 2025, when the 8th U.S. Circuit Court of Appeals decided the Biden administration was not authorized to establish the SAVE program."
The Department of Education announced that millions enrolled in the SAVE income-driven repayment plan may need to choose a new repayment plan under a settlement with Missouri. If the settlement is approved, borrowers could be required to resume repaying federal student loans and end the existing pause on payments and interest. SAVE caps monthly payments based on income and forgives remaining debt after a set number of payments. The 8th U.S. Circuit Court of Appeals ruled that the Biden administration lacked authority to establish SAVE. The new law did not extend tax-free loan forgiveness, and over 7.6 million borrowers are in SAVE forbearance.
Read at Fast Company
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