Department Begins Kicking Over 7 Million People Out of Most Affordable Student Loan Payment Plan

March 27, 2026 — Press Release

Borrowers Enrolled in SAVE Plan Must Apply for a New Plan and Brace for Increased Monthly Payments

WASHINGTON – Today, the U.S. Department of Education is beginning to email people enrolled in the popular Saving on a Valuable Education (SAVE) plan with a stark message: apply for a new plan within 90 days, or we will put you in the Standard Plan, which typically has the highest monthly payments. 

“The Department of Education is putting the burden on student loan borrowers to navigate this complicated mess quickly or face sky-high bills,” said Abby Shafroth, managing director of advocacy at the National Consumer Law Center. “The Department could have moved borrowers it is kicking out of SAVE into the next most affordable plan, and given people plenty of notice of the change. But instead it’s leaving people to fend for themselves in the midst of a deepening affordability crisis.”

While payments in the SAVE plan are based on a percentage of the borrower’s income, payments in the Standard plan are fixed based on a 10-year schedule to fully repay the loan. Many borrowers enrolled in SAVE had qualified for low or even $0 monthly payments due to their low incomes, but payments in the Standard plan can be hundreds or even thousands of dollars per month. Many borrowers will qualify for much lower payments in remaining income-driven repayment plans, such as the Income-Based Repayment plan (IBR) or Pay as You Earn plan (PAYE), than they would face in the Standard plan.

This action follows the Department’s capitulation to end the SAVE plan in response to a legal challenge by Missouri and other states. The SAVE plan offered federal student loan borrowers the most affordable payment option, and over 7 million people are enrolled in the plan. These borrowers haven’t had to make payments for the past year and a half due to the legal challenge. They will begin getting billed again once they change plans or the 90 days is up.

“This abrupt change is going to cause hardship for millions of people who are already struggling to manage rising costs in other areas, from gas, to groceries, to healthcare, to rent, and we’re going to see a lot more people default in the coming year,” said Shafroth. 

Related Resources

• Press Release: Elimination of SAVE Plan Puts More Than 7 Million Borrowers in Financial Peril, Mar. 10, 2026 
• Press Release: SAVE Survives Another Day: Court Refuses to Vacate Most Affordable Student Loan Repayment Plan, Feb. 27, 2026
• Press Release: Proposed Elimination of SAVE Plan Creates Uncertainty, Affordability Concerns for Student Loan Borrowers, Dec. 9, 2025
• Student Loan Borrower Assistance News: What’s Happening With the SAVE Plan? 
• SLBA News: Update on Lawsuits Challenging the SAVE Plan and Options for Borrowers
• SLBA News: SAVE: A New Payment Plan That Will Reduce Monthly Payments