SAVE Plan Court Case: Timeline and Frequently Asked Questions
With a chaotic student loan environment due to the SAVE and IDR court order, we’re clarifying which borrowers are affected, explaining the state of repayment plan applications, defining forbearance, and showcasing the timeline of the court case.
Juno Team
Sep 27, 2024
As of September 2024, the court case revolving around the SAVE plan and other income-driven repayment (IDR) plans are still ongoing due to disputes regarding their legality. Those who need more financial support have been thrown into a confusing student loan environment.
We’re answering some key points you need to know today:
- Am I affected?
- What is forbearance? How does it affect borrowers under the SAVE Plan?
- Can I apply for a new repayment plan currently?
- What is the timeline for the court case? When can we expect a final conclusion and changes?
Am I affected?
Anybody applying to an income-driven repayment plan (IDR) for federal loans could be affected. An income-driven repayment plan essentially adjusts a borrower’s required payment amounts depending on how much money you are making.
Those currently enrolled in the SAVE plan are most affected by the case, as their loans are currently under forbearance and are not making progress towards forgiveness.
If you did not apply or plan on applying for an IDR - or if you elected to opt out of SAVE - you are not facing any major impacts from this case.
What is forbearance? How does it affect me?
Forbearance is a temporary suspension of your payments, generally for administrative reasons or due to some kind of hardship. Everyone enrolled in SAVE is currently in general forbearance. Payments are not expected at this time, nor is interest accruing on their loan. However, none of this time counts towards forgiveness, which may increase the cost of their loan.
Can I apply for a new payment plan currently?
While you can submit an application, for certain repayment plans, processing is currently paused.
You won’t be able to submit an application online, and they’re only allowing PDF applications at this time. You can find the application and its instructions on this page.
There are two stages of forbearances for those who send in a paper application: a processing forbearance and general forbearance.
- The processing forbearance is for the first 60 days while the application is processing. It counts towards forgiveness and will accrue interest.
- Beyond those 60 days, the individual would be transferred into general forbearance, which does not count towards forgiveness but has no interest accruing.
If you are currently enrolled in SAVE, your servicer will give you the option to select a new IDR plan at some point in the future if you want to opt out of SAVE.
What is the timeline for when the future of the SAVE Plan will be clear?
- October 24th: There is a key court hearing on this date, with a decision expected soon after the hearing. In the best case scenario, the direction of a concrete plan would come no later than a few weeks afterwards. However, experts are expecting an appeal no matter the final verdict.
- Next Summer 2025: If the case is appealed, this is the latest expectation of when a final decision would be made by the Supreme Court. If this is the case, the final changes will most likely take place by early Fall 2025.
For future updates, we recommend periodically checking the Federal Student Aid’s “SAVE Plan Court Actions” page for any policy changes.
Written By
Juno Team
Juno came into existence to help students save money on student loans and other financial products through group buying power by negotiating with lenders. The Juno Team has worked with 90,000+ students and families to help them save money.
