Calling all Student Loan borrower’s with Undergraduate debt! Another roll-out of Student Loan Forgiveness is happening! If you’ve been paying on your Student Loans for at least 10 years, and you’re on an Income Driven Repayment Plan (IDR), read below to find out if you’re eligible!
A Refresher on SAVE:
The Saving on a Valuable Education (SAVE) student loan repayment plan was launched by the Biden Administration in August of 2023. SAVE replaced a previous Income Driven Repayment plan, REPAYE and required payment amounts became more favorable for borrower’s because they determined payment amounts would be based on the amount of discretionary income available to the borrower. Interest was also capped so borrower’s could no longer drown in interest amounts that kept them from paying off their loans. SAVE allowed an additional 1M borrowers to be eligible for less, or even, zero dollar amount payments compared to what they had been required to pay previously. If you were enrolled in REPAYE you should have been auto-enrolled in SAVE.
New Forgiveness Rules:
Beginning in February of this year, student loan borrower’s enrolled in the SAVE repayment plan who took out less than $12K in student loans, and have been making payments for at least 10 years, will have the remaining balance forgiven.
What if you borrowed more than $12K? There’s hope! For each additional $1K borrowed, one extra year will be added to the repayment period before forgiveness eligibility. For example, if you borrowed $15K, that’s $3K more than the $12K, and your loans will be forgiven after 13 years of repayment rather than the 10. (10years + 3 years = 13years).
Next Steps:
Determine your eligibility. If you think you might be eligible, login to your loan service provider and determine that you are on the SAVE plan. If you think you might be eligible for lower payments based on income, switch to the SAVE plan. Next, see how many years you have been making payments. If it’s at least 10, identify your original balance amount and if it’s less than $12K, your balance should be forgiven soon. If you are eligible, you may even be able to have any payments you made in 2024 refunded to you.
If your original balance is over $12K, determine how much over $12K it is and that is the amount you will tack on to 10 years to find out your required repayment number of years to be eligible for balance forgiveness.
Still have questions?
Visit StudentAid.gov for all things SAVE Plan Student Loan Forgiveness, or The Institute of Student Loan Advisors (TISLA) for fair, free student loan advice.
Unlocking Abundance 