Department of Education to millions of student loan borrowers: SAVE and pay.
The department announced Friday that it will begin sending notices to the 7 million borrowers enrolled in the SAVE plan detailing their next steps for payment.
Starting July 1, according to the department, servicers will notify borrowers enrolled in SAVE that they have 90 days to select a new payment plan and resume payments. Borrowers who do not select a new payment plan will be moved to a standard payment plan and the loan Administrators will notify you of your specific registration deadline.
“The 90-day period provides borrowers with sufficient time to explore repayment options that best fit their needs and plan accordingly,” the department said. “A borrower who wishes to transition before their loan servicer communicates a specific 90-day deadline may contact their servicer at any time to enroll in a legal repayment plan.”
Nicholas Kent, deputy secretary of education, said in a statement Friday that borrowers will receive more guidance “over the next week.”
“For years, borrowers have been trapped in a confusing cycle of uncertainty, but the Trump Administration’s policy is simple: If you take out a loan, you must pay it back,” Kent said.
SAVE was created by former President Joe Biden to offer borrowers cheaper monthly payments and a shorter timeline for loan forgiveness. The plan had been blocked since the summer of 2024 due to litigation, and borrowers were not required to make monthly payments. A federal judge recently approved a settlement with President Donald Trump and Missouri (one of the states that brought the litigation) to eliminate SAVE entirely.
The deal allowed the administration to eliminate SAVE and move borrowers to new plans ahead of schedule. Trump’s “big, beautiful” spending legislation, which included new repayment plans and borrowing limits, would have eliminated SAVE by 2028. The Education Department said SAVE borrowers will have the option to enroll in the new Repayment Assistance Plan, which is less generous than existing plans and allows relief after 30 years.
Do you have a student loan story to share? Contact this journalist at asheffey@businessinsider.com.