Federal appeals court orders end to SAVE plan used by millions of student loan borrowers

A federal appeals court has ordered the end of the Saving on a Valuable Education, or SAVE, plan, the Biden-administration-era repayment program that brought lower monthly bills to millions of student loan borrowers.

In a judgment issued late on Monday, the U.S. Court of Appeals for the Eighth Circuit reversed a lower court’s dismissal of a Republican-led legal challenge against SAVE.

The Biden administration introduced the SAVE plan in 2023, billing it as “the most affordable repayment plan ever created.” Under the program, many borrowers expected to see their monthly bills cut in half. But Republican-led legal challenges quickly put the plan on ice.

In February, Judge John Ross of the U.S. District Court for the Eastern District of Missouri dismissed the main lawsuit against SAVE.

Consumer advocates and borrowers hoped that the development meant the program would be revived temporarily. President Donald Trump’s “big beautiful bill” phases out the SAVE plan as of July 1, 2028. 

More than 7 million student loan borrowers remain enrolled in the SAVE plan as of the fourth quarter, according to the U.S. Department of Education.

The U.S. Department of Education did not immediately respond to a request for comment.

On Monday, four borrowers represented by Public Goods Practice, LLP, filed a lawsuit against the Department of Education, arguing the agency is compelled to immediately implement the SAVE plan. They say the department’s refusal to enact the SAVE plan and provide lower payments and loan discharge to eligible borrowers violates federal administrative law.

The lawsuit was filed just hours before the Eighth Circuit Court’s decision to reverse the earlier dismissal.

One of the plaintiffs, Elizabeth Robeson from South Carolina, said in the suit that she borrowed $12,000 in student loans during the 1980s, when she attended the University of Mississippi. She made more than 100 monthly payments beyond the 216 required for her to earn debt forgiveness under SAVE, but today her balance has swelled to $93,000.

“I have never been out of compliance on this loan and have paid for decades,” Robeson said in the suit. “The student loan crisis has cruelly forced millions of working Americans like me to live in a labyrinth with no clear exit despite our having followed the law.”

This is a developing story. Please check back for updates.