Overview
- Starting July 1, servicers will begin sending notices that give SAVE enrollees roughly 90 days to choose a new plan or be automatically moved into the Standard Repayment Plan or a new Tiered Standard Plan.
- The One Big Beautiful Bill Act creates a Repayment Assistance Plan that bases payments on adjusted gross income rather than discretionary income and can extend forgiveness timelines up to about 30 years.
- Borrowers who do not switch may see higher monthly payments, renewed interest accrual, and stricter forbearance limits of nine months in any two-year period, which increases the risk of missed payments and default.
- A law firm has asked a federal judge to pause forced transfers while litigation continues and a separate court order recently blocked part of the Education Department’s definition of 'professional degree' that affects graduate loan caps.
- Cities, legal aid groups, and nonprofit counselors are scaling free help as advocates warn of a 'default cliff' for people who miss notices or face servicer delays and tool errors that could block timely plan changes.