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Education Department Settlement Would End SAVE Plan, Forcing Millions to Switch Repayment Plans

A mounting processing backlog at the Education Department threatens to complicate the forced shift for millions.

Overview

  • The Dec. 9 proposed agreement with Missouri would terminate the SAVE program pending court approval, stop new applications, and deny all pending SAVE applications.
  • More than 7 million borrowers enrolled in SAVE would have to select a different repayment option within a limited time once the settlement takes effect.
  • A new court filing shows 802,730 requests to transfer into income-driven repayment plans were pending at the end of November, along with 80,210 Public Service Loan Forgiveness Buyback applications.
  • Processing remains slow, with just 170 IDR cancellations and 280 PSLF discharges completed in November, according to Education Department data.
  • Interest began accruing again in August for borrowers who stayed in SAVE forbearance, and a Repayment Assistance Plan is slated for 2026 with details not yet public.