Student Loan Repayment Changes
Student loan borrowers face crucial SAVE deadlines and extended federal autopay rate reductions.
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The first borrowers enrolled in the discontinued SAVE plan reached their 90-day deadline on Sept. 29 to choose a new repayment plan as the Education Department phases out SAVE following legal challenges. Borrowers who do not choose may be moved to a Standard or Tiered-Standard plan, substantially increasing monthly payments, though some servicers have reportedly extended individual deadlines by two to four weeks. The department directs borrowers to compare income-driven options, including IBR and the new Repayment Assistance Plan (RAP), and apply through StudentAid.gov or their servicer; the department has said a paper application including RAP will be available amid reports of online application problems. Separately, the deadline to enroll in autopay for a temporary 1-percentage-point federal student-loan interest-rate reduction has been extended to Dec. 31, 2026; the usual reduction is 0.25%. The enhanced discount is scheduled to end June 30, 2028, applies only while borrowers remain enrolled in autopay and make payments, and already applies to eligible borrowers enrolled in autopay.
Key Points
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About 7 million borrowers were enrolled in SAVE, and the Education Department has been sending exit notices in roughly two-week batches; Nelnet said borrowers were scheduled to receive notices through the end of 2026.
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SAVE borrowers had been in forbearance for more than two years before the administration terminated the plan under a settlement agreement resolving the legal challenges.
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The Education Department said nearly 2 million borrowers had enrolled in autopay since the enhanced discount became available. It said autopay can help borrowers receive credit toward forgiveness and other benefits that depend on timely payments.
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Beyond IBR and RAP, borrowers seeking income-driven payments may also be eligible for Income-Contingent Repayment or Pay As You Earn, according to the article.
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