A federal appeals court has ordered the end of the Saving on a Value Education (Save) Plan, a Biden-era income-driven repayment program launched in 2023. The decision leaves millions of borrowers without a clear path to paying off their loans, as the Trump administration also shuffles responsibility for the student loan portfolio to the Treasury Department.
New Education Department data shows that by the end of 2025, 7.7 million borrowers had defaulted on $181bn in federal student loans. The Save plan, which aimed to cut undergraduate loan payments in half and offer early forgiveness, was challenged by Republican attorneys general who argued it overstepped executive power and imposed heavy taxpayer costs.
Nicholas Kent, undersecretary of education, said the department would issue guidance on next steps for borrowers in the coming weeks. Meanwhile, Education Secretary Linda McMahon claimed that moving student aid to the Treasury would provide high-quality service. However, experts and advocates have expressed frustration and confusion.
Rachel Gittleman, president of AFGE Local 252, told the New York Times the changes have “sown chaos for states and grantees”. Michele Zampini of TICAS said there is “a lot of frustration, a lot of anger, confusion and disengagement”. Robert Farrington of the College Investor advised borrowers to log into StudentAid.gov, check their loan details, and ensure they are on a repayment plan.
Financial aid expert Mark Kantrowitz urged borrowers to track everything, including qualifying payments and loan balances. The Education Department removed its payment tracking tool in April 2025 and has said it will not bring it back. Borrowers currently on the Save plan will need to switch to a different repayment plan, though no timeline has been announced.
