January 15, 2025 Update:
Borrowers who were already in the SAVE plan by July 17, 2024 will remain in forbearance and do not need to recertify until February 2026. This forbearance will not count towards PSLF or IDR Forgiveness. Borrowers can still apply for SAVE but will NOT be enrolled in the plan while the injunction is still in effect. Because of this, we have removed the option to enroll in SAVE at this time through Savi. Borrowers who apply or have applied for the SAVE plan can choose at any time to switch to a different Income-Driven Repayment (IDR) plan and enter repayment. The Department of Education re-opened the Income Contingent Repayment (ICR) and Pay As You Earn (PAYE) plans to borrowers because of these lawsuits. At this time the SAVE plan litigation is not expected to be resolved until September 2025. Borrowers should expect a lengthy delay in processing for all IDR applications
November 19 Update:
A recent federal court injunction has barred the Department of Education from implementing parts of the SAVE plan. As a result, borrowers who were already in the SAVE plan by July 17, 2024 will remain in forbearance and do not need to recertify at this time. Borrowers can still apply for SAVE but will NOT be enrolled in the plan while the injunction is still in effect. Because of this, we have removed the option to enroll in SAVE at this time through Savi. Borrowers who apply or have applied for the SAVE plan can choose at any time to switch to a different Income-Driven Repayment (IDR) plan as in the coming weeks servicers will begin processing recertification and new enrollment applications for borrowers eligible for Income Based Repayment (IBR), Income Contingent Repayment (ICR), or Pay As You Earn (PAYE). At this time the SAVE plan litigation is not expected to be resolved until Summer 2025. Borrowers should expect a lengthy delay in processing for all IDR applications
July 18 Update:
On July 18, a federal court ruling put temporarily the SAVE Plan on hold. While the lawsuits are still pending and the Department of Education works to respond, borrowers who are enrolled in the SAVE plan will temporarily be placed in a forbearance. If you are placed in forbearance, you will not accrue interest and you will not be required to make payments.
In response to the decision, the Department of Education also temporarily removed the ability to enroll in an Income-Driven Repayment Plan through StudentAid.gov. However, manual and paper applications are still being accepted. You can enroll or switch your Income-Driven Repayment Plan through your Savi account, just as you normally would.
Savi will continue to monitor the situation and provide more updates here as they become available.
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SAVE Plan Details
The Department of Education released a new IDR plan called the SAVE plan, which helps lower monthly payments for many student loan borrowers. This new plan replaced the REPAYE plan. Borrowers enrolled in REPAYE were moved to SAVE and had their payment recalculated.
This plan includes many new benefits, and some of the highlights are:
- Raise the amount of income that is considered non-discretionary income and therefore is protected from repayment, guaranteeing that no borrower earning under 225% of the federal poverty level—about the annual equivalent of a $15 minimum wage for a single borrower—will have to make a monthly payment.
- Cover the borrower's unpaid monthly interest, so that unlike other existing income-driven repayment plans, no borrower's loan balance will grow as long as they make their monthly payments—even when that monthly payment is $0 because their income is low.
- Calculate your monthly payment using just your income, if you are married filing separately. This will remove the previous requirement that included spousal income even when filing separately, helping keep your monthly payment low.
Proposed changes would introduce even more benefits to the SAVE Plan, but they are currently on hold due to pending lawsuits.
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Forgive loan balances after 10 years of payments, instead of 20 years, for borrowers with original starting principal loan balances of $12,000 or less.
- For each additional $1,000 borrowed over $12,000 one year will be added to the forgiveness timeline.
- The maximum time to forgiveness will be 20 years for undergraduate loans and 25 for graduate.
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Forgive loan balances after 10 years of payments, instead of 20 years, for borrowers with original starting principal loan balances of $12,000 or less.
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Require borrowers to pay no more than 5% of their discretionary income monthly on undergraduate loans. This is down from the 10% available under the most recent income-driven repayment plan.
- Borrowers with undergraduate and graduate loans will have a monthly payment between 5-10%, based on the weighted average of their loan balances.
- Borrowers with graduate loans will have a monthly payment at 10% of their discretionary income.
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Require borrowers to pay no more than 5% of their discretionary income monthly on undergraduate loans. This is down from the 10% available under the most recent income-driven repayment plan.
You can see your eligibility and enroll in SAVE by completing your Savi General Info application.
For more information, visit https://studentaid.gov/announcements-events/save-plan