Student Loan Repayment Changes: SAVE Plan Settlement and IBR Expansion

SAVE Plan Settlement and Borrower Impact

• ⚠️ A proposed settlement agreement could end the Biden administration's SAVE income-driven repayment plan.
• 🎯 If approved, approximately 7 million borrowers may need to quickly find a new repayment plan.
• 📌 Borrowers on the SAVE plan have been in forbearance since the lawsuit began over a year ago.
• 💡 Under the SAVE plan, some borrowers had payments as low as $0 per month with potential loan forgiveness in as little as 10 years.

Income-Based Repayment (IBR) Plan Expansion

• ✅ The Department of Education is expanding the IBR plan, a change that is considered good news for borrowers.
• 🛠️ System updates in December now accommodate the expansion of the IBR plan, removing the partial financial hardship requirement.
• 🚀 This expansion is a result of a significant bill passed last year.

Navigating Repayment Options

• 🔍 While awaiting a court decision on the SAVE plan settlement, the Department of Education advises borrowers to use the FSA's loan simulator.
• 📊 The loan simulator can help estimate monthly payments and determine eligibility for other repayment options.