HOW TO APPLY FOR USDE INCOME-DRIVEN LOAN REPLAYMENT PLAN DURING BETA PERIOD - A/K/A SAVE (1381 hits)
For Immediate Release From USDE!
Apply for the SAVE plan during the beta period and you won’t have to reapply later!
Have you heard of the new income-drive repayment plan, Saving on A Valuable Education (SAVE)? It’s the most affordable student loan repayment plan in history!
The Biden-Harris Administration has been working on the SAVE plan application and we need you to test the application before it officially launches. And the best news is – if you apply during the beta period, you won’t have to reapply later.
As a reminder, monthly payments on the SAVE plan – like all income-driven repayment plans – are based on your income and family size, not your loan balance. Under the SAVE plan, your payment will be $0 if you are a single borrower earning $32,800 or less, or a family of four earning $67,500 or less. Other borrowers will save at least $1,000 per year on their payments, and your balance won’t grow because of interest.
Here’s what you can expect when you fill out the SAVE application:
Log in with your FSA ID.
Fill out your information. Because of improvements to the application, you won’t have to reapply or worry about missing your annual recertification date. Find out how much the SAVE plan can help you save on your monthly payments. Submit your application and be one of the first to sign up for the new plan. You won’t have to reapply after the beta period ends!
Learn more about the SAVE plan and the benefits the new plan offers. If you're currently on the Revised Pay As You Earn (REPAYE) repayment plan, you will be automatically enrolled in the new SAVE plan in the coming weeks and do not need to apply: https://studentaid.gov/announcements-event...
The SAVE plan is a critical step in delivering on President Biden’s commitment to supporting students and borrowers, and helping more American families get out from under the burden of student loan debt. Explore additional actions the Biden-Harris Administration has taken to support borrowers and provide debt relief to as many people as possible, as quickly as possible: https://studentaid.gov/manage-loans/forgiv...
We’re here to help borrowers prepare for their upcoming student loan payments. Learn more about the steps borrowers can take to prepare for payments to resume in October and additional support the Administration is offering to borrowers when the payment pause ends: https://studentaid.gov/manage-loans/repaym...
Sincerely,
Miguel A. Cardona Secretary of Education
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Student loan borrowers who are fearful that they won't be able to afford to restart their payments in October can take a look at a new affordable option right now called SAVE or the Saving on a Valuable Education Plan.
SAVE won't bail out everyone's budget. But it could work well for millions of borrowers who might be buried in other debt, like high cost credit cards, or find themselves wondering how to pay the rent.
One of the best features: The interest on those federal student loans won't build up and trap you if you consistently make the required payments under the SAVE plan. About 70% of borrowers on income-driven repayment plans before the pandemic-related pause are expected to benefit from this change alone, according to the U.S. Department of Education.
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If your required monthly payment doesn't cover the interest, the department will stop charging any of the monthly interest not covered by that monthly payment on the SAVE plan.
"Notably, the SAVE plan eliminates all remaining interest on subsidized and unsubsidized loans after a payment is made," said Bruce McClary, senior vice president of media relations and membership for the National Foundation for Credit Counseling.
The change addresses a problem involving negative amortization.
