Following several court decisions, the Education Department has suspended the SAVE program and placed SAVE borrowers into an administrative forbearance period.
The SAVE program forbearance period will not count towards forgiveness, including under the SAVE plan and Public Service Loan Forgiveness (PSLF). No payments are required during this time. The Department anticipates the SAVE plan pause to last at least six weeks, according to court filings.
Online IDR Applications Unavailable, but a PDF Application Process is Available
Borrowers in the SAVE plan who want to avoid losing qualifying payments toward forgiveness may consider switching to a different income-driven repayment (IDR) plan. While the online IDR application portal is down, borrowers can submit a PDF application as an alternative.
Please note that other IDR plans typically have higher monthly payments than the SAVE plan, and the PDF application process is expected to take longer. Loan servicers are currently unable to process IDR applications until the Department can ensure accurate processing.
New SAVE Applicants Will Be Placed In Administrative Forbearance
If you apply for the SAVE plan using the PDF application and the court order is still in effect, you will automatically be placed in forbearance. This would benefit student loan borrowers waiting to apply for the SAVE plan until the end of the on-ramp period. The federal student loan on-ramp period ends September 30th, so if borrowers need to continue to have a safety net against missed payments, submitting a PDF application now is important given the likely processing delays.
Republican-led states have appealed the decision allowing the SAVE program to lower payments to the Supreme Court.
The Repulican-led states challenging the SAVE program have appealed the 10th Circuit court’s decision to the Supreme Court. The states are asking for an injunction to block the lower payments.
While the legal challenges play out in court, IonTuition is here to help borrowers with repayment. Contact an IonTuition counselor through our online portal with any questions about your repayment options.