Introduced by the Biden administration in 2023, the Saving on a Valuable Education (SAVE) plan offered lower payments and a faster path to loan forgiveness for millions of borrowers. However, it was swiftly met with legal challenges and was struck down by the courts in March 2026. The One Big Beautiful Bill Act (OBBBA) fully ended the SAVE plan on July 1, 2026. If you’re one of the seven million borrowers on SAVE, here’s what you need to know and the steps you can take to enroll in a different repayment plan for your federal student loans.
Why is the SAVE plan ending?
Shortly after the SAVE plan was introduced, 11 Republican-led states sued the Education Department (ED) and the Biden administration, saying the plan overstepped executive authority and would hurt state revenue.
The courts placed a temporary injunction on the plan, and SAVE borrowers were placed in an interest-free forbearance. Interest began accruing again on August 1, 2025, though payments remained on pause for millions of borrowers.
In December 2025, ED announced that it had come to a proposed settlement to end the SAVE plan. And in March of 2026, the Eighth Circuit Court of Appeals finalized this order to get rid of SAVE.
SAVE’s termination was also written into OBBBA, which contained a major overhaul to the federal student loan system starting on July 1, 2026. OBBBA introduced new repayment plans that will be available to borrowers who need to switch to a new plan.
What happens if you’re currently enrolled in SAVE?
If you’re currently enrolled in SAVE, you may not have made payments on your student loans for several years. You’ll need to prepare to resume paying your loans again soon now that the SAVE plan has been officially eliminated.
Loan servicers will start sending notices to borrowers about moving out of SAVE and into an alternative repayment plan. You’ll have 90 days from the date specified in your notice to switch to another repayment plan.
If you don’t pick a different plan, your loan servicer will choose a plan for you. It’s better to compare your options and select one yourself, though, since your loan servicer may not choose the most affordable plan.
What other income-driven repayment plans are available?
Currently, you have several other income-driven repayment plans to choose from, including plans that existed prior to July 1, 2026 and a new plan that was introduced after that date.
Here’s where things get a little tricky, though two of the current income-driven repayment plans are slated for elimination by July 1, 2028. While you can still technically enroll in them, you may be better off choosing a plan that’s not on the chopping block.
Here’s a closer look at your current income-driven repayment options.
Income-Based Repayment (IBR)
The Income-Based Repayment plan adjusts your payments to 10% of your discretionary income if you borrowed after July 1, 2014. If you borrowed before that date, you’ll pay 15% of your discretionary income.
It also extends your loan terms to 20 years for post-July 1, 2014 borrowers and 25 years for pre-July 1, 2014 borrowers. Any remaining balance after that time will be forgiven, though you may have to pay taxes on the amount.
Pay As You Earn (PAYE)
The PAYE plan adjusts your monthly payments to 10% of your discretionary income and comes with a repayment term of 20 years. To qualify, you need to be a new borrower on or after October 1, 2007 and have taken out a Direct loan on or after October 1, 2011. You’re also only eligible if your payment on PAYE would be less than what you’d pay on the standard 10-year repayment plan.
PAYE may offer the lowest payments for some borrowers, but the plan won’t be around forever. Due to OBBBA rules, it will be eliminated by July 2028.
Income-Contingent Repayment (ICR)
This plan adjusts your monthly payments to 20% of your discretionary income and comes with a 25-year repayment term that can end in loan forgiveness. Along with PAYE, ICR will be eliminated by July 2028.
Repayment Assistance Plan (RAP)
Created by OBBBA, RAP is a new income-driven repayment plan that was introduced on July 1, 2026. It bases your monthly payments on your adjusted gross income, rather than your discretionary income. You’ll pay between 1% and 10% of your AGI and have repayment terms up to 30 years. If your monthly payment doesn’t cover all your interest, the remaining amount will be waived.
Other repayment plans you can consider
If you’re not looking for another income-driven repayment option, here are some other plans you can consider. Unlike IDR plans, none of these end in loan forgiveness.
- Standard 10-year repayment plan: This plan involves fixed monthly payments over 10 years.
- Graduated 10-year repayment plan: This plan also spans 10 years, but your payment starts out lower and increase every two years.
- Extended 25-year repayment plan: This plan asks for fixed or graduated monthly payments over 25 years.
- New standard plan: OBBBA’s new Standard Plan has you make fixed payments over 10, 15, 20, or 25 years, depending on how much you owe. Borrowers with a balance under $25,000, for example, will have a 10-year term, while those who owe $100,000 or more will pay over 25 years.
How to choose the best repayment plan
When it comes to choosing the best repayment plan, a helpful tool you can use is the Federal Loan Simulator. Start by entering your information, including your loan balance and income.
The plan will estimate your payments and long-term costs on each available plan so you can compare. Keep in mind that these are only estimates; the actual numbers might be different.
If this tool hasn’t been updated with the new RAP plan yet, you can use an alternative like this calculator from EDCAP.
If you’re pursuing Public Service Loan Forgiveness, stick to an income-driven repayment plan, as those are the only ones that qualify for PSLF.
What should SAVE borrowers do now?
If you’re a SAVE plan borrower, keep an eye out for a notification from your loan servicer about switching away from the plan. Many SAVE borrowers will need to switch by October 2026 or risk being auto-enrolled in a plan by their loan servicer, which may not be the best fit for their budget or repayment goals.
Take steps to compare your repayment plan options and use the Federal Loan Simulator and other online calculators to estimate your monthly payments and forgiveness eligibility on each available plan. You can also switch sooner rather than later to resume making payments on your student loans.
The most important step you can take is being proactive and researching your options. That way, you can choose a plan that best fits your circumstances and avoid automatic placement into a potentially more expensive repayment plan.
