The SAVE income-driven student loan repayment plan is now on shaky ground. The 8th Circuit Court’s recent ruling that upheld the injunction against the SAVE plan (and broadened it to the REPAYE Plan) has cast a long shadow over the Saving on a Valuable Education (SAVE) plan.

While the program remains technically in place, the recent legal ruling has sent it back to a lower court, setting the stage for an eventual shutdown. At this point, the only thing keeping SAVE alive is procedural delay—and potentially political maneuvering.

Here’s what borrowers in the SAVE plan need to know as they plan for its eventual demise. 

Why SAVE Is Likely To Be Eliminated

The legal challenge to SAVE hinges on the argument that the Department of Education exceeded its authority in structuring a repayment plan that significantly reduces or even eliminates payments for many borrowers beyond what was written in law. Republican-led states and conservative legal groups have opposed the plan, calling it an unfair transfer of debt burden onto taxpayers.

Though the program remains in limbo, the outcome is becoming clear after the opinions in the appeals court decision: the courts are likely to rule against SAVE. Specifically, the appeals court said it appears likely the Department of Education overstepped its authority using Income-Contingent Repayment as the backbone of SAVE.

The court highlighted that the Secretary of Education does not have the authority to grant student loan forgiveness through an ICR plan. Specifically, it said ICR plans were designed for loan repayment, not forgiveness. 

You can read the wording of the regulations here, and why we believe this is still an open-ended question (though the courts may disagree). 

However, the lower court is likely to use much of the argument provided by the 8th Circuit Court, thereby ensuring that SAVE will be blocked permanently. 

If Biden was still president, it’s likely his administration would appeal the rulings all the way to the Supreme Court. However, it’s unlikely the Trump Administration would appeal.

Related: Student Loan Statistics In 20252025

But there’s a twist—Republican lawmakers may want the program to stay in place just long enough to be repealed through legislative action.

Under budget reconciliation rules, ending the SAVE plan could be counted as a cost-saving measure, allowing Congress to claim over $127 billion in projected savings over the next decade.

If the courts strike the plan down too soon, lawmakers lose the opportunity to include it in budget negotiations. This means the Trump administration might file a strategic appeal—not to save the program, but to delay its formal cancellation until Congress can act.

In this scenario, it could simply buy student loan borrowers more time in forbearance, but the end result would be the same. 

Related: Republican Budget Proposals To Cut Student Aid And Loan Programs

What Borrowers Should Expect Going Forward

For the 8 million borrowers currently enrolled in SAVE, uncertainty remains. Borrowers enrolled in the plan are currently in administrative forbearance, which would end once the court officially blocks the SAVE program for good (or Congress acts to eliminate it).

While this will likely end this year, it’s unknown when. And even once it does end, borrowers will need to wait for guidance from the Department of Education and their loan servicer about when the re-start would occur. It will likely take 60-90 days or longer to restart borrowers in the SAVE forbearance. There will also need to be rules made to re-assign borrowers to other repayment plans.

In the meantime, borrowers should begin considering alternative repayment plans and preparing for potential changes.

• Income-Driven Repayment (IDR) Alternatives: If SAVE is eliminated, borrowers may need to transition to other IDR plans like Income-Based Repayment (IBR), which may have higher monthly payments.
• Legal and Political Delays: While the plan is likely doomed, the timeline remains unclear. Borrowers should make sure their information is updated with their loan servicer so they don’t miss any timelines like thousands of borrowers recently did.
• How Repayment Plans Will Change: If the courts ultimately eliminate SAVE, there may be questions about what plans borrowers may transition to, especially if borrowers don’t opt to make their own change. This will need to be decided and implemented, and may take time.

The fate of SAVE underscores the current volatility of student loan policy, especially with the new administration looking to scale back the scope of government. 

Borrowers should know that no action is required today, but they need to be reviewing their options and preparing for a future without SAVE.

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