Education Department removes SAVE plan roadblock but reopens older repayment options

The U.S. Department of Education is set to reopen applications for certain income-driven repayment (IDR) plans on March 26, 2025. This decision follows a court injunction that had previously halted access to these options, leaving many student loan borrowers uncertain about their repayment plans. While borrowers can reapply for older IDR plans like Income-Contingent Repayment, Income-Based Repayment, and Pay As You Earn, the new SAVE plan remains unavailable due to the ongoing legal challenges. This situation could lead borrowers to choose less favorable repayment options. The reopening will provide relief to numerous borrowers, but the absence of the SAVE plan highlights ongoing issues within federal student loan programs. Currently, alternatives for managing federal student loans appear limited, which may lead to financial strain for some borrowers juggling monthly payments and the need to comply with recertification deadlines. The changes present a mixed outcome for borrowers, as they face a lack of clarity regarding the implications of this development. It is essential for borrowers to fully understand their repayment options and follow through on recertification requests, especially to avoid moving to standard payment plans that don’t consider income. Efforts continue to address the limitations imposed by the injunction and to clarify available options for those directly impacted by these recent changes.