Student Loan Borrowers Face an Uncertain Future as Courts Rule the End of the SAVE Program

By Amna Khalafalla

March 21, 2026     

On April 1, millions of student loan borrowers received an email from the U.S. Department of Education (ED) announcing the end of the Biden-era Saving on a Valuable Education (SAVE) repayment plan. SAVE, deemed “the most affordable student loan plan ever” by the previous administration, was ruled illegal on March 10 by a judge in Missouri’s Eighth Circuit Court of Appeals.

In the email, the 7.5 million borrowers affected by the ruling were instructed to select a new plan by July 1 or be automatically enrolled in a different repayment plan.

Introduced in 2023, the SAVE program was established to lower monthly loan payments, particularly for low-income borrowers, community college students, and those working in public service. Borrowers saw their payments reduced from 10% of their discretionary income to 5%, bringing some people’s monthly payments to zero. Those who made timely payments and re-certified their eligibility annually would see debt forgiveness after 20 or 25 years.

The March 10 ruling was not the first time lawmakers had tried to eliminate SAVE, a controversial initiative from its inception. In July 2024, the U.S. Court for the Eastern District of Missouri blocked the ED from implementing parts of the program, following a motion filed by a group of attorneys general from Missouri, Arkansas, Florida, Georgia, North Dakota, Ohio and Oklahoma in April of that year. The motion placed all borrowers on forbearance with a 0% interest rate.

In February 2025, the Court of Appeals for the Eighth Circuit expanded the ruling by blocking the entire SAVE plan and requiring an end to the 0% interest benefit starting August 1. On December 9, the Trump administration and the State of Missouri reached a settlement to dismiss the litigation and end the program. Then, on February 27 of this year, the Court for the Eastern District of Missouri ruled in favor of borrowers, denying the settlement between the two parties and dismissing the lawsuit, a ruling that was overturned two weeks later by the March 10 decision.

The termination of SAVE has left first-generation borrowers uneasy about the future. For 26-year-old Bengali American Afrah Howlader, who graduated in 2025 with a masters in public health, the federal loan program provides much-needed financial assistance. “Being from an immigrant community, and especially coming from a low-income family, this was a lifeline,” she said. “Grad Plus and federal loans, these are a lifeline to economic mobility for people from our communities.”

Afrah Howlader, who graduated in 2025 with $48,000 in student debt, wonders whether she will be able to continue working at a nonprofit. Photo courtesy of Afrah Howlader

Howlader, who owes $48,000 in federal loans, selected a career in the public sector with the Public Service Loan Forgiveness (PSLF) program in mind. The program forgives the debt of qualifying borrowers who make 120 monthly payments while working in government or nonprofit organizations. The SAVE plan gave Howlader the peace of mind that she would be able to pay back her student loans, she said.

Without SAVE, graduates will have to reconsider careers in public service, which typically pay lower salaries than the private sector, she added. “You’re going to see a lot less representation [in public-sector fields]. I can’t fathom what my trajectory will look like without the flexibility [of SAVE].”

SAVE also provided a sense of relief to Fatima A. (who asked that her last name be withheld), a first-generation Sudanese American who graduated from a state university in 2017 with a degree in biology and $21,000 of debt. When SAVE was launched, Fatima, 30, was automatically enrolled in it, and her monthly payments dropped to $249. “It gave me hope and a little grace to be able to reach a point in my career where I can afford [bigger] monthly payments,” she said.

With the additional discretionary income, Fatima could afford to rent her own apartment and pay for other essentials, but a higher loan payment will force her to change her living situation, she said. “Between the monthly payments and inflation, I may need to move back in with my parents.” 

The Department of Education will continue to offer Income-Based Repayment, Income-Contingent-Repayment and Pay-as-You-Earn (PAYE), as well as newer plans — the Repayment Assistance Plan (RAP) and Tiered Standard Plan. However, none of these plans offers payments as low as the SAVE program. In fact, according to the National Consumer Law Center, monthly payments may quadruple.

“It impacts the saving plans I have,” Howlader said. “I might have to find [additional] part-time work … or make the tradeoff of finding a job that’s not at a nonprofit.”

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Amna Khalafalla is a Sudanese American, Philadelphia-raised photo documentarian with a background in international development. She is currently working on a long-term project documenting Philadelphia’s community of Sudanese activists and is an Al-Bustan Journalism Fellow.

Al-Bustan News is made possible by a grant from Independence Public Media Foundation.