Appels Court Halts SAVE Student Loan Repayment Plan

A U.S. Court of Appeals issued a July 18 ruling preventing the U.S. Department of Education from operating the Saving on a Valuable Education (SAVE) plan.  

SAVE, an income-driven repayment option unveiled by the department in August 2023, is one of the most popular options for medical school borrowers repaying student loans due to the monthly interest subsidy that is a key feature of the plan.  

In an update detailing the impact to SAVE enrollees, the department indicated that borrowers currently enrolled in the SAVE plan will be placed into a temporary forbearance while court proceedings continue. During this period, payments will not be required, and interest will not accrue on balances. This time in forbearance will not count toward Public Service Loan Forgiveness or Income-Driven Repayment loan forgiveness. 

Impacted SAVE borrowers will be notified of this forbearance by their student loan servicers