SAVE Plan Borrowers Face Higher Monthly Payments After Permanent Elimination

Over 7 million student loan borrowers will likely face higher monthly payments as they are forced to exit the SAVE plan. The SAVE plan was the most affordable option for most people, and any replacement plan will likely increase costs. Borrowers must enroll in another repayment plan by the end of September. This requirement follows a settlement between the Trump administration and the state of Missouri, which the Eighth Circuit Court of Appeals instructed a district court to approve to permanently eliminate the program.

Borrowers have been in administrative forbearance without payments due since the summer of 2024, though interest began accruing in August 2025. Starting July 1, servicers will email instructions on how to leave the plan. Borrowers have 90 days to select a new option, such as existing income-based repayment plans or the new Repayment Assistance Plan (RAP) established under the One Big Beautiful Bill Act.

Those who do not take action by the end of September will be automatically enrolled in the 10-year standard plan, which results in considerably higher payments in many cases.