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The U.S. Department of Education has begun sending notices to borrowers enrolled in the SAVE plan that they will have 90 days starting July 1 to select a new repayment plan — or be automatically transferred to the standard 10-year plan.
Roughly 7 million borrowers are still in SAVE forbearance, and many had to make $0 monthly payments under the plan. Auto-enrollment in standard repayment can increase monthly bills from zero to several hundred dollars, often without warning.
Time
- July 1, 2026: Service providers have started issuing 90-day notices
- September 30, 2026: save tolerance ends
- 30 June 2028: All borrowers on remaining legacy plans (PAY, ICR) will have to move to RAP or IBR
*There are reports that there may be a varying timeline and not all borrowers will see their savings forbearance expire in September. However, no clear communication saying otherwise has been provided.
Available Repayment Plan Options: For now, borrowers can go to IBR, PAYE, or ICR. Starting July 1, all new federal loans will only have access to the tiered standard plan or Repayment Assistance Plan (RAP) created under the One Big Beautiful Bill Act. Existing borrowers on legacy income-driven repayment plans will have to transition to RAP or IBR by June 30, 2028.
Our view: Borrowers should not wait for the 90 day notice. Now calculate the monthly payments under each available plan (using the Federal Loan Simulator). studentaid.gov or College Investor’s RAP Calculator) is the difference between choosing a plan that fits the household budget and defaulting to a plan that does not fit the household budget.
How it connects: College Investor has covered the SAVE transition extensively, including how RAP compares to IBR, what to do if your servicer hasn’t reached out, and why Senate Democrats are pushing to extend the transition window. With the transfer of the federal loan portfolio to the Treasury Department, the system handling these changes is being rebuilt at the same time borrowers are being asked to navigate it.
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Robert Farrington is the founder of The College Investor and is recognized as one of the nation’s leading voices on student loan debt and saving for college. He holds an MBA from the UC San Diego Rady School of Management and has spent more than 15 years researching, writing and advising on student loans, 529 plans, financial aid programs and savings and investing for young professionals.
Robert is featured in the new York Times, wall street journal, Washington Post, nbc newsAnd forbeswhere he has been a regular personal finance contributor for over a decade. His work combines both professional expertise and personal experience – he successfully completed his student loan repayment journey and has helped thousands of readers do the same.
He is committed to making the intersection of personal finance and education transparent and accessible. You can learn more about Robert on his About page or at his personal site robertfarrington.com.
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