Trump Administration Agrees to End SAVE

The Education Department aims to settle a lawsuit with the state of Missouri that will put an end to a Biden-era loan repayment policy.

That plan, known as Saving on a Valuable Education, has been blocked since summer 2024, and court battles have left nearly eight million borrowers in limbo.

If approved by a federal judge, the settlement agreement will expedite Congress’s plan passed in the One Big Beautiful Bill Act to repeal SAVE in July 2028.

Among other provisions, the department agreed to move all SAVE borrowers into “legal repayment plans,” deny pending applications and not forgive student loans for eligible borrowers.

The department didn’t say Tuesday how that transition for borrowers would work aside from that those on SAVE will have a limited time to switch. A notice to borrowers noted that the online tool to explore other repayment plans won’t be up-to-date until later this month.

Critics have called the move to end SAVE without giving borrowers a clear alternative “reckless and shortsighted.”

“[It’s] creating even more needless confusion, uncertainty, and financial stress for millions of Americans already struggling with the rising cost of living,” said Abby Shafroth, managing director of advocacy at the National Consumer Law Center, in a statement.

Other debt relief advocates warned Tuesday that the demise of SAVE could force some borrowers into default. 

Republican-led states that were plaintiffs in the suit, Trump officials and other advocates have argued that SAVE was illegal and the Biden administration misled borrowers with false promises. They also took issue with the plan’s estimated $342 billion price tag.

“For four years, the Biden Administration sought to unlawfully shift student loan debt onto American taxpayers, many of whom either never took out a loan to finance their postsecondary education or never even went to college themselves, simply for a political win to prop up a failing Administration,” Under Secretary of Education Nicholas Kent said in a statement. “The Trump Administration is righting this wrong and bringing an end to this deceptive scheme.”