Betsy Mayotte

Confusion, anxiety, feeling sort of stuck because they don't know what to do to successfully manage their loans because of all the changes.

And is there going to be more changes?

Yes.

Yeah.

So the SAVE plan was another version of an income-driven repayment plan, of which we've had quite a few of those over the years, and those continue to exist.

But it was the Biden administration's attempt to make student loans even more affordable, especially for people who have high debt compared to what their income is.

It was also intended to provide, for some borrowers, a quicker...

path to forgiveness after making a certain number of payments under that plan.

Unfortunately, one of the many first time this ever happens, that plan was challenged in court by 13 attorney generals, state attorney generals.

And it appeared like the court was leaning towards siding with those attorney generals, with the plaintiffs, that the administration had gone beyond the powers that had been afforded to them by Congress to create this plan.

And I'm oversimplifying, essentially because they felt it was more generous than Congress had intended.

Since then, Congress themselves got rid of the SAVE plan as part of H.R.

1 last summer.

And now we're just sort of waiting for this proposed settlement agreement.

So the borrowers that are, these 7 million borrowers that are still in what we call the SAVE limbo, know what direction and at what point they do need to leave the SAVE plan.

Well, right now, the people that are still in the save limbo are in forbearance, meaning that there's no payment due at all.

But it also means that they're not progressing towards loan forgiveness under a different income-driven repayment plan or perhaps loan forgiveness for public service loan forgiveness or even...

just paying their loans off.

So once the settlement is finalized, they will be forced off of this save forbearance and be forced to choose a different repayment plan.

And for almost all of them, that is going to mean a higher monthly payment than what they had under the save plan.