The U.S. Department of Education has begun sending formal notices to student loan borrowers still in the SAVE repayment plan. Notice tells borrowers they have 90 days to choose New repayment plan. The notice clearly states, “You must now choose a new repayment plan within 90 days.”
If the borrower does not select another plan within 90 days, their loan will automatically be transferred to the Standard Repayment Plan or the Tiered Standard Plan, depending on the situation. The notices are part of the government’s plans to officially end the SAVE repayment scheme. According to Forbes , the SAVE program was launched during the administration of former President Joe Biden as an income-driven repayment plan.
The SAVE program has faced legal challenges for nearly two years. Congress passed a law last year ending the SAVE program. A federal appeals court later approved a legal settlement that eliminated the SAVE program’s provisions. As a result of these legal and political changes, millions of borrowers are now having to leave savings plan. Many borrowers remain confused about when they must exit SAVE and how the process works.
Who receives these notifications?
The Department of Education will begin sending formal 90-day notices on July 1, 2026. These notices are only sent to borrowers who are enrolled in the SAVE program, have applied for SAVE, or have been affected by a SAVE forbearance due to an old repayment application. The notice states that due to a recent legal settlement, the SAVE program is no longer available.
Borrowers in SAVE status who take no action for 90 days will be moved to a standard or tiered standard repayment plan. For many borrowers, monthly payments can be significantly higher under a standard plan. According to Forbes, payments under the standard plan generally do not count toward loan forgiveness programs, including Public Service Loan Forgiveness (PSLF).
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Some borrowers will be included in the tiered program that began earlier this month. Some people never officially join SAVE but are placed in the SAVE respite program after applying. If these borrowers take no action within 90 days, they will return to their pre-SAVE repayment plan.
Timelines Borrowers Should Know
No borrower will receive a formal 90-day notice before July 1, 2026. The Department of Education announced in March that loan servicers would begin sending these notices on July 1. The department also said borrowers who do not change plans within 90 days will automatically be placed in the standard or tiered standard plan.
Prior to July 1, the department was issuing only warning messages and no formal 90-day notices. These early warnings did not start a 90-day countdown. The 90-day countdown begins only after the borrower receives official notice. Borrowers do not need to leave SAVE before Sept. 29, 2026, because that is 90 days after July 1, the Department of Education said in a court filing.
The department said notifications will be sent in batches rather than all at once. According to Forbes, some borrowers may not receive formal notice until early 2027. Loan servicers will tell each borrower their own 90-day period.
Repayment options after exiting SAVE
The official notice tells borrowers that although SAVE has ended, there are other repayment options. One option is a pay-as-you-earn (PAYE) plan. Congress has allowed the PAYE scheme to continue until 2028. Another option is the income-based repayment (IBR) plan, which will continue. Borrowers also have the option of a new Repayment Assistance Program (RAP).
The RAP begins the same day the department begins sending formal notices. According to Forbes, Department of Education officials said hundreds of thousands of borrowers have withdrawn from SAVE.
Officials also said thousands of borrowers signed up for RAP within 24 hours of its launch. Nearly 1 million borrowers have exited the SAVE program, Deputy Education Minister Nicholas Kent said, according to a statement by Nicholas Kent on X. Kent urged borrowers still in SAVE to visit StudentAid.gov and choose another legal repayment plan.
Concerns raised by advocacy groups
Student loan advocacy groups say many borrowers could face higher monthly payments after exiting SAVE. They warned this could lead to a payment shock for many households. Advocacy groups, cited by Forbes, also said RAP could lower payments for some borrowers but could require them to continue making payments for years before they qualify for loan forgiveness. As a result, some advocacy groups recommend that borrowers enjoy the SAVE grace period for as long as possible without receiving formal notice.
Debt Collective said borrowers who received notices on July 1 still have a full 90 days to take action, according to Debt Collective X. The group also advises borrowers who have not yet received formal notice to avoid making a quick decision to leave. save. Other advocacy groups encourage borrowers to carefully compare all repayment options before choosing a new plan.
According to Forbes, citing advocacy groups, the groups said some borrowers may benefit from switching early, especially if they want to continue working to repay or have their loans forgiven. They also said borrowers who may be struggling to cope with higher monthly payments may consider keeping a SAVE forbearance until they receive a formal 90-day notice.
