Trump administration moves to end student loan payment pause for millions. Here’s what it means for borrowers
Student loan payments could resume for millions of borrowers
- The U.S. Education Department has announced a settlement that could lead to the termination of the Saving on a Valuable Education (SAVE) student loan repayment plan.
- This agreement, which requires court approval, would necessitate approximately 7.6 million borrowers currently enrolled in the SAVE plan to select new repayment options.
- If the settlement is approved, affected borrowers will have a “limited time” to choose a new income-driven repayment plan via the Federal Student Aid website or opt for fixed payment plans.
- The SAVE plan, introduced by the Biden administration, faced legal challenges from GOP-led states, resulting in an appeals court blocking its implementation in February.
- The settlement aims to dismiss the ongoing litigation, with the Department agreeing to cease new SAVE enrolments and transition existing borrowers to other legal repayment plans.