Over 7 million student loan borrowers enrolled in a Biden-era repayment scheme have been ordered to pick a new plan or risk being automatically placed on one vastly more expensive -- unless a higher court reinstates it.
Borrowers enrolled in the Saving on a Valuable Education plan will begin receiving notices about switching to other ways to repay starting Friday, according to the Department of Education. The Trump administration has long targeted SAVE, which was struck down by a federal court last week. (It is expected to be appealed.)
Loan servicers will now begin issuing notices giving borrowers 90 days to select a new repayment plan, department officials said. They will then resume making payments as soon as this summer.
Around half of those on the SAVE plan had incomes low enough to qualify for its zero-dollar monthly payment. The standard plan orders them to pay fixed payments over 10 years, leading to huge increases.
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