Student Loan IDR Applications Misfire for 7 Million SAVE Borrowers Ahead of July 1 Changes
Updated
Updated · Forbes · Jun 22
Student Loan IDR Applications Misfire for 7 Million SAVE Borrowers Ahead of July 1 Changes
3 articles · Updated · Forbes · Jun 22
Summary
Borrowers are reporting widening errors in the Education Department’s online income-driven repayment applications just days before major federal loan changes begin on July 1.
Problems include missing PAYE eligibility, flat $50 payment estimates regardless of income, unnecessary consolidation prompts, and 404 errors—issues that can steer borrowers into costlier plans or erase forgiveness credit.
More than 7 million SAVE borrowers will start getting notices on July 1 and have 90 days to choose a new plan; those who do not switch may be moved into Standard repayment with higher monthly bills.
The strain is building as the department also launches the new RAP plan and other repayment changes while roughly 530,000 IDR applications remain unprocessed.
Watchdogs say the risk has grown after the department cut its workforce by half and reduced servicer oversight across a $1.6 trillion federal student loan portfolio.
A critical loan deadline is days away. With the system broken, is it already too late for parents to save their repayment options?
As the student loan system fails, how can millions avoid a payment shock when their plans are canceled in days?
The End of the SAVE Plan and the Rise of OBBBA: Navigating the 2026 Student Loan Repayment Crisis
Overview
The report explains how legal action by Republican officials led to the termination of the Biden administration’s SAVE student loan repayment plan, creating an immediate crisis for millions of borrowers. With the end of SAVE, borrowers who relied on it for income-driven forgiveness are now losing time toward their forgiveness goals and must quickly switch to alternative repayment plans. The report highlights the urgent need for borrowers to act, as months spent under SAVE forbearance no longer count toward forgiveness, and details the broader challenges and risks borrowers face in this rapidly changing student loan landscape.