- The U.S. Department of Education is placing federal student loan borrowers enrolled in the Biden administration’s new income-driven repayment plan, known as SAVE, into an administrative forbearance. There is a glitch in Kamala's payoff campaign.
- Eligible borrowers in that repayment plan will not have to make any payments on their debt while the break lasts, and interest will not accrue on their loans in the meantime. The U.S. Department of Education is placing federal student loan borrowers enrolled in the Biden administration’s new income-driven repayment plan, known as SAVE, into an administrative forbearance. They will remain in forbearance while the legal battle involving SAVE plays out.
What that means: Eligible borrowers in that repayment plan will not have to make any payments on their debt while the break lasts, and interest will not accrue on their loans in the meantime. The White House says roughly eight million people are enrolled in SAVE, or the Saving on a Valuable Education Plan. Borrowers eligible for the relief should receive notification from their servicer, according to the Education Department. The SAVE Plan has been a magnet for controversy ever since the Biden administration rolled out the program in the summer of 2023, describing it as “the most affordable student loan plan ever.”
Indeed, the terms of the new income-driven repayment plan are the most generous to date. SAVE comes with two key provisions that legal challenges have targeted: It has lower monthly payments than any other federal student loan repayment plan, and it leads to quicker debt erasure for those with small balances.