US Education Dept. Settles to End SAVE Loan Plan

The U.S. Department of Education announced a proposed settlement on Tuesday with the state of Missouri that would end the Saving on a Valuable Education (SAVE) student loan repayment plan, affecting nearly 8 million enrolled borrowers and hundreds of thousands more awaiting approval. The agreement, which requires federal court approval, accelerates the program's termination well ahead of its scheduled expiration in July 2028 under the One Big Beautiful Bill Act signed by President Donald Trump this summer.

The settlement stems from a lawsuit filed by Missouri and other Republican-led states challenging the SAVE plan's legality. It directs the department to halt new enrollments, deny all pending applications, and transition current participants into other available repayment options. Borrowers in the program, which has been on hold since court rulings in 2024 and early 2025, will receive notice and a limited window to select alternatives, though details on the exact timeline remain unclear. An online tool for exploring repayment plans is expected to update later this month.

Introduced by the Biden administration in 2023, the SAVE plan was an income-driven repayment program...