Department of Education To Move Millions of Borrowers From Biden-Era Student Loan Repayment Plan

Core Insights - The Department of Education is transitioning over 7 million borrowers from the Biden-era SAVE repayment plan to alternative repayment options due to legal challenges, which may lead to higher monthly payments and increased default rates [1][1][1] Group 1: Department of Education Actions - The Department of Education, under Secretary Linda McMahon, will soon move borrowers from the SAVE plan to another repayment plan, with guidance to be issued shortly [1][1] - The SAVE plan is deemed "unlawful" and will be phased out, with borrowers needing to transfer to the Income-Based Repayment plan as other options will be eliminated by July 2028 [1][1][1] Group 2: Borrower Impact - More than 10.5 million borrowers are currently either delinquent or in default on federal student loans, and the end of the SAVE plan could exacerbate this issue [1][1] - Borrowers are advised to take action to resume payments or progress toward loan forgiveness, with three income-driven repayment plans available: Income-Contingent Repayment, Pay As You Earn, and Income-Based Repayment [1][1][1] Group 3: Future Developments - A new Repayment Assistance Plan is expected to be available by July 2026, providing additional options for borrowers [1][1] - The ongoing legal saga surrounding the SAVE plan has caused delays in the Department of Education's operations, which may continue to affect borrowers [1][1]