Student loan borrowers exiting SAVE may face sharply higher payments if they don't take action soon
Millions of student loan borrowers could see their monthly bills skyrocket if they don't move into an affordable repayment plan soon. Here's what to know.
TL;DR
- Federal student loan borrowers on the SAVE plan have a 90-day window to switch to another repayment program after being notified.
- The SAVE plan, an affordable income-driven repayment plan, was overturned by legal challenges, potentially leading to doubled or tripled monthly payments for borrowers who don't transition.
- Notification timelines are staggered, with some borrowers' deadlines as early as September 29th; others will receive notices later in the year.
- Borrowers should check their loan servicer accounts, update contact information, and apply for new plans on studentaid.gov or their servicer's website.
- Those who do not select a new plan will be automatically placed into the Standard Repayment Plan or the new Tiered Standard Plan.
- Alternative income-driven repayment plans, like the Repayment Assistance Plan (RAP), offer lower monthly payments and potential loan forgiveness.