By Student loan borrowers will soon be removed from the Saving on a Valuable Education, or SAVE, plan, the Trump administration announced on Friday.
The Education Department said it would send guidance to the 7.5 million people who signed up for the now-defunct repayment plan. “In the guidance, the Department provides information on how borrowers can enroll in a new, legal federal student loan repayment plan and previews upcoming changes to student loan repayment options,” according to the announcement.
SAVE enrollees have been slow to exit: Roughly 7.2 million people remained in the program as of December, according to recently released agency data.
Here’s what borrowers need to know.
Why is the SAVE plan going away?
Soon after the Biden administration introduced the SAVE plan in 2023, several Republican-led states sued to block its implementation, arguing that President Joe Biden did not have the authority to grant the forgiveness and lower payments the plan promised.
After nearly two years of litigation, the SAVE plan was officially blocked by a federal appeals court earlier in March.
Borrowers who enrolled in the plan but haven’t switched into another repayment plan have been in an administrative forbearance without payments due since the plan was challenged in court in the summer of 2024. Interest resumed accruing for those borrowers in August.
What’s my deadline to leave SAVE?
Borrowers will have 90 days starting on July 1, 2026, to select another repayment plan, the U.S. Department of Education said in its statement. Loan servicers will communicate specific deadlines to affected borrowers.
What other repayment options do I have?
Borrowers can enroll now in existing income-driven repayment plans — such as the Income-Based Repayment plan, or IBR — or wait until the new Repayment Assistance Plan rolls out on July 1.
RAP was established in July with the passage of President Donald Trump’s “big beautiful bill.” Under RAP, monthly payments will typically range from 1% to 10% of your earnings; the more you make, the bigger your required payment. There will be a minimum monthly payment of $10 for all borrowers.
The Standard Repayment Plan is also available for borrowers who want fixed monthly payments over 10 years, regardless of their income. A new tiered standard repayment plan, also created by the recent legislation, will roll out on July 1 with options for borrowers to extend their loan term over 10, 15, 20 or 25 years.
How can I compare repayment options?
There are several tools available online to help you determine how much your monthly bill would be under different plans.
“Most borrowers will be better off in IBR” than in RAP, said higher education expert Mark Kantrowitz.
Loan forgiveness can come in 20 years under IBR, compared with the 30-year timeline on RAP. While some borrowers may have a smaller payment on RAP than IBR, they’ll pay more over the life of the loan, he added.
Depending on their income and loan balance, some borrowers may be better off on the standard repayment plan, though.
“If you’re a borrower with a relatively low loan balance and a higher income, you might decide to go with the standard plan,” said Kate Wood, lending expert at NerdWallet. “Because making higher payments and saving on interest versus making lower payments for longer makes more sense.”
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