A Biden student loan plan has ended. Here’s what borrowers need to know.

WASHINGTON — A federal court order last month to effectively axe a Biden-era student loan repayment plan capped years of chaos for more than 7 million student borrowers enrolled in the program.

The Saving on a Valuable Education, or SAVE, plan marked a cornerstone of the Joe Biden administration’s loan forgiveness efforts but became mired in legal challenges from several GOP-led states.

On July 1, federal loan servicers will start sending notices to borrowers instructing them to enter into a legal repayment plan within 90 days, the department said. Borrowers who do not switch within the 90-day window outlined by their servicer will be automatically placed into a new plan.

The agency issued guidance to borrowers in late March instructing them of the timeline and urging people to switch into a new plan.

Here’s what borrowers need to know as they navigate next steps:

How did we get here?

The program, introduced in 2023, sought to lower monthly loan payments for borrowers and forgive remaining debt after a certain period of time.

But millions of borrowers experienced chaos and confusion as they were forced to navigate complex court rulings, interest accrual on their debt and continued uncertainty over the plan’s fate.

Borrowers were placed in an interest-free forbearance in 2024 amid legal limbo, and the department resumed charging interest on the debt of those in the program in August 2025.

President Donald Trump’s administration in December announced a proposed agreement to end the plan.

The agreement stemmed from a legal challenge to the plan brought by Missouri, Arkansas, Florida, Georgia, North Dakota, Ohio and Oklahoma in 2024.

A federal judge dismissed that lawsuit in late February, striking down the administration’s efforts to axe the plan.

But a federal appeals court reversed the lower court’s decision in March, effectively putting an end to the SAVE plan.

Was the SAVE plan already slated for elimination?

Congressional Republicans’ mega tax and spending cut bill signed into law by Trump in July 2025 includes a sweeping overhaul of the federal student loan system.

Part of the GOP’s “big, beautiful” law phased out the SAVE plan by July 2028.

I’m in SAVE. What are my new repayment options?

Borrowers have several new repayment options, and can switch to a new plan prior to receiving the incoming notice from their federal loan servicer.

One option includes the Income-Based Repayment, or IBR, plan, which ties borrowers’ loan payment to their earnings.

Borrowers also have the option to enter into two repayment plans stemming from the GOP’s “big, beautiful” law — the Repayment Assistance Plan, or RAP, and the Tiered Standard plan — which will both launch July 1.

Preston Cooper, senior fellow in higher education policy at the American Enterprise Institute, a right-leaning think tank, noted that whether IBR or RAP is a better deal for borrowers depends on their particular circumstances.

“I would recommend that if you are kind of earlier in your repayment journey, and you have a lot more interest because your balance is higher, the Repayment Assistance Plan is going to be your best bet,” Cooper said.

“If you’re later in your repayment journey, you’re closer to that 20 or 25-year mark for forgiveness, Income-Based Repayment is probably going to be your better bet,” he added.

Borrowers could also opt into a handful of other repayment options, such as the Pay as You Earn and Income-Contingent Repayment plans.

However, those two plans will be eliminated by July 2028 under Republicans’ “big, beautiful” law, meaning borrowers would have to switch plans again in two years.

What other steps can I take in the meantime?

Michele Zampini, associate vice president for federal policy and advocacy at the Institute for College Access & Success, said the best thing for a borrower to do is “just be proactive.”

“Make sure, from a very base level, you can access your account, you know all the basics of where you stand, and then do some comparisons across what plan options you’re going to have,” said Zampini, whose organization aims to advance affordability, accountability and equity in higher education.

Zampini also pointed to Federal Student Aid’s loan simulator as a good resource for borrowers to get specific numbers to compare across plans.

“If there’s a plan that you want to move into that’s already open and available, if it’s one of the older plans, start moving now, if you can afford it,” she said. “And then, if you want to wait for the new plan to open … know what that payment estimate is going to look like, and then set yourself a reminder for July to check back and look at the enrollment process once that plan opens.”

Amid the “total dissonance and chaos” borrowers in SAVE have experienced, Zampini said the department “has really shirked its responsibility in at least keeping borrowers updated and giving them clear information on what’s happening, when it’s happening, and what the implications are going to be for their payments and kind of their budgets and what they have to do and when they have to do it.”

What about the plan to eliminate the department?

Persis Yu, deputy executive director and managing counsel at the advocacy group Protect Borrowers, told States Newsroom she is “incredibly worried about borrowers not being able to figure out what to do, missing the deadline, getting put into a plan that they can’t afford, and then falling into default, which has, of course, incredibly onerous consequences.”

The end of SAVE also comes as the Trump administration continues its efforts to dismantle the Department of Education, including through a series of interagency agreements that transfer several of its responsibilities to other departments.

Under the most recent agreement, the Treasury Department will take over Education’s responsibility for collecting on defaulted federal student loan debt — the first step in a multiphase process toward Treasury taking on Education’s entire, roughly $1.7 trillion federal student loan portfolio.

“The specifics of the plan with Treasury right now are about debt collection, but the overarching mission of dismantling the Department of Education at this moment means that there are not the people in place to oversee the servicers,” Yu said.

Part of the administration’s efforts to do away with the agency included a reduction in force initiated in March 2025 that hit wide swaths of the department, including Federal Student Aid, or FSA.

Yu also highlighted a March report from the nonpartisan Government Accountability Office, which found that staffing reductions at FSA affected the government’s ability to determine how well student loan servicers are doing their jobs.