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What are you all doing about the SAVE plan?
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I know the question of SAVE status is all over this subreddit, but hope the mods can allow me to post since I have a few specific questions and am trying to gather opinions.
SAVE plans start accruing interest again August 1st. In theory, we can still make payments while in forbearance, yes. Why are they pushing so hard on us to drop SAVE? And, for the longest time I was on an income driven repayment plan and my loans were going to be forgiven after 25 years. Is that the case on SAVE?
Real bummer that I worked at a non profit for 5 years and maybe 3 of those counted towards PSLF. So dumb. The email they sent is stressing me out. Anyone here choosing a different repayment plan? What’s the consequence if I stay on SAVE?
Top Comment: I'm wondering if they are pushing hard for us to get off of SAVE so they can tell the judge in the Missouri case that there are only X% of people left on the plan, giving them more of an impetus to get rid of it quicker. I'm staying for the time being.
SAVE Plan Diamond Hands Unite!
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I’m holding on SAVE for as long as possible.
90K in loans. Taken recently as I just finished my grad program in 2023. Not going for PSLF.
Putting $$ into HYSA this whole time.
I’m holding as long as I can. Until they force me off. However if/when interest starts 8/1 I will most likely make interest payments so it doesn’t balloon.
Who’s with me? 💎
Top Comment: Im staying on until they force me off. Idgaf anymore. I’ll pay the bare minimum when payments are set to resume and these loans are either gonna get forgiven down the road or die with me lol
What is everyone’s current plan if you’re on SAVE?
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Looking for advice on my currently enrolled SAVE plans.
Loan status: I have a double consolidated parent plus loans enrolled in SAVE, and I have a personal loan enrolled in SAVE.
I have been seeing a lot of information across the internet where people are talking about it being crucial to apply to a current ICR (I believe?) before whatever is happening early July to retain access to apply to certain types of repayment or you’ll lose access if you remain in forbearance. I don’t know the actual accuracy and after researching here I can’t seem to find a straightforward answer, it seems some people are remaining on SAVE until forced off, while other people are pushing that you need to change apply to retain access before it’s too late.
Does anyone have more information, or a place I can read up on what’s going on here?
Top Comment: Based on the reconciliation bill as it’s currently written, if you have Parent Plus loans (unconsolidated, single-consolidated, or double-consolidated) your loans will need to be in repayment on the ICR plan the day before the bill is signed into law in order to be eligible for any income-driven plan at all going forward. If they are in ICR the day before the bill is signed (if it even is) then you would be eligible for amended IBR. If you are not paying on ICR the day before the bill is signed then you would no longer be eligible for any IDR plans. You would only have the standard plan, graduated, and extended. This means if you have unconsolidated PPL loans then you should probably consolidate and get on the ICR plan as soon as possible. If you already have consolidated PPL loans, whether it was a single OR DOUBLE consolidation, the safest place for you to be is in repayment on the ICR plan when the bill is signed into law (if it is). The bill would move all borrowers currently on SAVE, ICR, or PAYE into amended IBR starting on the date of enactment. But it specifically makes PPL loans ineligible for IBR unless they meet the exact criteria given: being repaid on ICR the day before the date of enactment of the bill. . Explanation with sources below: “Excepted” consolidation loans are made ineligible for IBR and RAP under the bill. There would be no way for them to be repaid on RAP. But there is a special rule written to allow them to be eligible for amended IBR. The bill explains: “(A) EXCEPTED CONSOLIDATION LOAN DEFINED.-Section 493C(a)(2) of the Higher Education Act of 1965 (20 U.S.C. 1098e(a)(2)) is amended to read as follows: (2) EXCEPTED CONSOLIDATION LOAN.- (A) IN GENERAL.-The term 'excepted consolidation loan' means— (i) a consolidation loan under section 428C, or a Federal Direct Consolidation Loan, if the proceeds of such loan were used to the discharge the liability on an excepted PLUS loan; or (ii) a consolidation loan under section 428C, or a Federal Direct Consolidation Loan, if the proceeds of such loan were used to discharge the liability on a consolidation loan under section 428C, or a Federal Direct Consolidation Loan described in clause (i).” Clause (i) describes a single-consolidated PPL loan. Clause (ii) describes double consolidated PPL loans. The bill adds: “(B) EXCLUSION.-The term 'excepted consolidation loan' does not include a Federal Direct Consolidation Loan described in subparagraph (A) that (on the day before the date of enactment of this subparagraph) was being repaid pursuant to the Income Contingent Repayment (ICR) plan in accordance with section 685.209(b) of title 34, Code of Federal Regulations (as in effect on June 30, 2023).". You can find 685.209(b) as in effect on June 30, 2023 here: Section (b) is specifically the ICR plan. The senate version of the bill explains this on page 35 The house version did not differ. Here is a post where this was discussed a lot And another . Please keep in mind that we don’t know what the final draft of the bill will look like or if it will even be signed into law. But so far both the house and senate versions of the bill include this language for PPL loans and agree on it. I understand the ICR plan can make payments very high compared to other options. I cannot tell anyone what to do. I can only make suggestions based on the exact text of the bill. Maybe that wording will change. Maybe there will be wiggle room when it comes to the Department of Education interpreting and actually implementing the bill. There are so many “maybes”. So much is in flux. Everything is in limbo now. Everything is a guess and a gamble. All you can do is make the decision that is best for you based on the current information we have.
Student loans interest no longer 0% (save plan)
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I was on the SAVE plan and my loans have been on 0% and in forbearance. I logged in today and my loans seemed to jump up 2k and are back to 5-7% interest rates. Still in forbearance until end of July. Servicer is Mohela. Calling them now but what is going on? Any one else having this issue?
Update: called and rep stated that my loans are indeed accruing interest but should be at 0%. A request was put in to fix this and the accrued interest should be removed after that. Will wait to feel relieved if that happens. Very frustrating!
Top Comment: On SAVE forbearance and servicer is Aidvantage. Interest rate is 0.00% and $0 payment due. Balance has stayed the same since forbearance began in July of last year.
SAVE Plan? What do we do if you’re still in it.
Main Post: SAVE Plan? What do we do if you’re still in it.
Top Comment: Unless you're nearing a forgiveness payment number for PSLF or others, just wait it out.
A bit of an update on what to expect with SAVE
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There is a federal register being published tomorrow that contains some language in the preamble that indicates the ED's plans for SAVE considering the litigation. The language indicates that they are working on amending SAVE to meet the court requirements and it will essentially mimic the old repaye as far as borrowers payment amounts - but will have less of an interest subsidy than repaye had. So essentially the same interest subsidy that IBR and paye have. The language is as follows:
"The Department is working to build a version of the SAVE plan that complies with the Eighth Circuit’s injunction. That plan would generally have the same terms as the 2015 REPAYE rule with respect to the monthly payment amounts for borrowers. At this time, the Department anticipates that such work will not be completed until at least the early fall of 2025."
And later in the document:
"The Department is working to create a version of the SAVE plan that complies with the terms of the Eighth Circuit injunction. This plan will be largely similar to the terms of the REPAYE plan, with the exception that the injunction prevents the Department from providing the interest benefits that were also provided under the REPAYE plan. Both the 2015 REPAYE plan and the SAVE plan provided that a borrower with a subsidized loan would not be charged any unpaid interest for the first three years while enrolled in the plan and that all borrowers with subsidized or unsubsidized loans would only be charged 50 percent of unpaid interest after the first three years enrolled in the plan. Until that revised plan is available, the Department will keep borrowers who remain enrolled in the SAVE plan in forbearance and interest will not accrue."
There is no real discussion about loan forgiveness, including how the "new" repaye plan would include forgiveness nor the injunction around forgiveness currently in place for ICR and PAYE.
If we speculate that the new Education Department administration will withdraw their appeal around SAVE soon after inauguration, I think what this language above tells us that they will probably be extending the SAVE forbearances until they can get this new version in place, which won't be until the fall. Whether they will automatically switch folks over to it currently in SAVE remains to be seen, but I expect they might after giving borrowers the opportunity (which they have now actually) to switch to another plan.
They are VERY clear in this federal register that they do not have the ability to make these save forbearances count towards either PSLF or IDR loan forgiveness. Of course buy back is still available for PSLF borrowers for this period - but it's unclear if buy back will be available for this period for IDR forgiveness.
So with this in mind I think those borrowers pursuing forgiveness have a better sense of whether it makes sense to switch plans now or ride out the forbearance. Also those on SAVE can start budgeting knowing what their payments might look like once the dust has settled. If it does mimic the old repaye it will be AGI-150% of the poverty level for the borrowers family size and state - so the same as paye. I don't expect they will bring back the repaye requirement where both spouse's incomes will count regardless of filing status - so if i'm right those filing separately will be able to continue to just use the borrowers income.
It's a shame to lose that extra interest subsidy for sure. And of course the lower payments SAVE provided. For those that want to fight this all you can do is encourage Congress to put a plan such as SAVE into federal law.
Just to set the stage - everything I know is here. I'll post the link to the federal register once it's published tomorrow, but I did mention everything relevant in this post.
Top Comment: Riding this out till they force me to switch. I’ll take the extra months of $0 payments $0 interest personally