Claiming the Saving on a Valuable Education Plan (SAVE) was an illegal overreach of executive authority, the Department of Education announced the cessation of SAVE in early December.
The SAVE plan was established as a student repayment program by the Biden administration.
“It was so affordable, generous and flexible – with its fast-tracked loan forgiveness and monthly payments as low as $0 for low-income borrowers – that Republican state attorneys general sued the Biden administration for exceeding its authority,” NPR said.
Legal troubles sparked by the suit left many SAVE borrowers “in limbo,” allowing interest to accrue on loans beginning in August.
“Before the proposed settlement was announced in December, the Department of Education resumed charging interest on SAVE borrowers’ accounts on August 1, 2025,” Business Insider said. “For now, enrolled borrowers await further guidance from the Department of Education once the settlement is implemented.”
“Without congressional authorization, the Biden Administration misled millions of borrowers into the illegal SAVE Plan with false promises of artificially low monthly payments – oftentimes as low as $0 – and a short timeline to student loan ‘forgiveness,’” The Department of Education said.
According to Secretary of Education Nicholas Kent, the law makes it clear that if you take out a loan, “you must pay it back.”
The SAVE agreement highlighted an “ideological battle between conservatives.”
“[Some conservatives] feel that student loan forgiveness, any far-reaching student loan forgiveness in particular, really is an affront to people who have not gone to college. They shouldn’t have to foot the bill for folks who did pursue a college education,” PBS said.
CNBC said that the over 7.7 million borrowers should start thinking about making changes to their loan payments.
“They could be paying thousands more in compound interest,” CNBC said. “Some could see their monthly bills more than double.”
Many SAVE borrowers have expressed distress in response to this new change, fearing how they will repay loans that have quadrupled in interest due to the lawsuit.
However, except for SAVE, there are still existing student loan repayment programs being offered by the government.
According to CNBC, the Income-Based Repayment Plan, making interest-only payments and refinancing loans are all “valid” options in repaying student loans.
The SAVE program’s suspension has affected other repayment plans, like the Public Loan Forgiveness Plan
The Public Service Loan Forgiveness is a plan erasing student loan debt after working 10 years in public service).
According to NPR, individuals working toward Public Service Loan Forgiveness found their progress halted due to the various legal troubles in dismantling SAVE.