Tuesday, September 5, 2023
- Over 4 million borrowers enrolled in new SAVE income-driven repayment (IDR) plan.
- 1.6 million IDR applications received since July 30; nearly 1 million for SAVE.
- Borrowers earning <$15/hour pay zero; potential $1,000 yearly savings on SAVE.
- No balance growth from unpaid interest with consistent payments.
- New IDR application uses IRS data, eliminating annual re-certification.
- 12-month protection plan introduced for late/missed payments.
- Over $117 billion relief approved for 3.4 million borrowers.
Unedited Press Release Text:
Biden-Harris Administration Announces More Than 4 Million Student Loan Borrowers Are Enrolled in the New SAVE Plan
The U.S. Department of Education today announced more than 4 million student loan borrowers are enrolled in the Biden-Harris Administration’s new Saving on A Valuable Education (SAVE) income-driven repayment (IDR) plan, including those who were transitioned from the previous Revised-Pay-As-You-Earn (REPAYE) plan. Additionally, the Department has received more than 1.6 million IDR applications through StudentAid.govsince July 30, and nearly one million of those applications are for the SAVE plan, the most affordable IDR plan ever.
“Millions of borrowers are already benefitting from enrollment in the SAVE plan, and I’m thrilled to see so many Americans submitting applications every day so that they, too, can take advantage of the most affordable student loan repayment plan in history,” said U.S. Secretary of Education Miguel Cardona. “From Day One of this Administration, President Biden has focused on reducing the burden of student loan debt on working families, and we are not stopping now. Enrollment is quick and easy, and we are working relentlessly to get the word out to borrowers about how millions can reduce their monthly student loan bills and save over a thousand dollars a year by enrolling in SAVE.”
Under the SAVE Plan, a single borrower who makes less than about $15 an hour will not have to make any payments, and borrowers earning above that amount would save more than $1,000 a year on their payments compared to other IDR plans. The SAVE Plan also ensures that borrowers never see their balance grow due to unpaid interest as long as they keep up with their payments. The new IDR application allows borrowers to have their income accessed securely from the Internal Revenue Service so they do not need to re-certify their income or re-apply for IDR plans every year.
“The new application is easy and quick. Most people only need about 10 minutes to complete it,” said Federal Student Aid Chief Operating Officer Richard Cordray. “Borrowers can get their monthly payment calculated in real time, and they can choose to have their IDR application recertified automatically each year.”
Borrowers applying for the SAVE plan or other IDR plans will see their new payment amount before submitting their application, and it will be displayed on their servicer’s website when their first bill is sent. Most borrowers who apply for the SAVE Plan can expect their next payment to reflect their SAVE amount. Servicers will place borrowers in a forbearance if they need more time to process their application. After borrowers apply, they can check the status of their application by visiting their account dashboard on StudentAid.gov. Borrowers can also use Loan Simulator to calculate student loan payments across other repayment plans and choose a loan repayment option that best meets their needs and goals.
The Department and its servicers have reached out directly to nearly 30 million borrowers to invite them to use the new IDR application to apply for the SAVE Plan. This outreach is part of the Department’s robust campaign to provide information and resources to borrowers to support them. The Department has also been in direct touch with 43 million borrowers and will continue to coordinate with servicers and outside partners to provide additional high-quality communications with specific, actionable information directly to borrowers to make sure every borrower has the information they need to make the best repayment decision for themselves. In addition, the Department has instituted a 12-month on-ramp to protect borrowers from the harshest consequences of missed, partial, or late payments.
The Department has also begun a nationwide outreach campaign called “SAVE on Student Debt” in collaboration with leading grassroots organizations. “SAVE on Student Debt” is leveraging strategic partnerships across public, private, and nonprofit sectors to make sure borrowers know the supports available to them as they return to repayment and can they take full advantage the SAVE Plan and other available benefits and debt forgiveness programs.
The SAVE Plan builds on the work the Biden-Harris Administration has already done to improve the student loan program and make higher education more affordable. The Biden-Harris Administration has already approved more than $117 billion in targeted relief for 3.4 million student loan borrowers, including:
- $39 billion for 804,000 borrowers through fixing historical inaccuracies in the IDR payment count system for borrowers who earned forgiveness;
- $45.7 billion for 662,000 public servants through improvements to Public Service Loan Forgiveness (PSLF);
- $10.5 billion for 491,000 borrowers who have a total and permanent disability; and
- $22 billion for nearly 1.3 million borrowers who were cheated by their schools, saw their schools precipitously close, or are covered by related court settlements.
The Biden-Harris Administration remains committed to making college more affordable and ensuring student debt is not a roadblock to attaining a college degree or credential, or planning for the future. The Administration has made the largest increase to Pell Grants in a decade and has charted a course to double the maximum Pell Grant and make community college free to enhance college affordability and reduce unnecessary student debt. The Administration is also holding institutions accountable for unaffordable debts and recently proposed regulations that would set standards for earnings and debt outcomes for career programs while enhancing transparency for all programs to give students the information they need to make informed choices.
Borrowers can view more resources and tools that help them find the right repayment plan for their current circumstances at StudentAid.gov/restart. More information about SAVE is available at StudentAid.gov/save.
State by State Data on SAVE Enrollment:
Borrowers Enrolled in SAVE
|District of Columbia||13,100|
|All Other Locations||46,500|