The Saving on a Valuable Education (SAVE) Plan
Most of our blog posts focus on bankruptcy and how it can help you to get a financial fresh start. Today’s post will focus on a change affecting repayment options for student loan borrowers. The Saving on a Valuable Education (SAVE) Plan is a new income-driven repayment (IDR) plan that was introduced by the Department of Education in July 2023. The SAVE Plan is designed to make student loan payments more affordable for borrowers with low or moderate incomes.
Here are some of the key features of the SAVE Plan:
- Lower monthly payments: The SAVE Plan has lower monthly payments than other IDR plans. For example, a single borrower with an income of $30,000 per year would have a monthly payment of $0 under the SAVE Plan, compared to $130 per month under the Revised Pay As You Earn (REPAYE) plan.
- No payment cap: The SAVE Plan does not have a payment cap, so borrowers can make payments that are higher than their calculated monthly payment amount. This can help borrowers to pay off their loans more quickly.
- Loan forgiveness: Borrowers who make 20 or 25 years of qualifying payments under the SAVE Plan may be eligible for loan forgiveness.
The SAVE student loans repayment Plan is a good option for borrowers who are struggling to make their student loan payments. It offers lower monthly payments than other IDR plans, and it does not have a payment cap. This can help borrowers to manage their debt and make their payments more affordable.
Who is eligible for the SAVE Plan?
The SAVE Plan is available to borrowers with federal student loans, including Direct Loans and FFEL Loans. Borrowers must have a qualifying income and family size to be eligible for the SAVE Plan. The income limits for the SAVE Plan are based on the federal poverty guidelines.
How do I enroll in the SAVE Plan?
To enroll in the SAVE Plan, you must contact your student loan servicer. Your servicer will be able to help you determine if you are eligible for the SAVE Plan and how to enroll.
The SAVE Plan is a new IDR plan, and it is still being rolled out. If you are interested in the SAVE Plan, it is a good idea to contact your student loan servicer to see if you are eligible and how to enroll.
Here are some additional resources for people who are interested in the SAVE Plan:
- The Department of Education’s website: https://studentaid.gov/
- The National Consumer Law Center: https://www.nclc.org/
- The National Association of Student Financial Aid Administrators: https://www.nasfaa.org/
- The American Fair Credit Council: https://www.afcc.org/
I hope this blog post has been helpful. Greenway Law Group is always happy to help you with your financial issues. Contact us for a free consultation on how we can help you get a financial fresh start. We offer appointments by phone, Zoom or in person.