If you enrolled in the SAVE plan, you may not have a payment due for now—what borrowers need to know: If you have enrolled in the SAVE plan, you may not have a payment due for now. It is important for borrowers to understand the terms of their plan and when their next payment is due.

On Thursday, the 8th Circuit Court of Appeals in Missouri ruled that President Joe Biden's Saving on a Valuable Education income-driven repayment plan cannot be implemented as planned.

From July onward, federal student loan borrowers on the SAVE plan were anticipating lower monthly payments, while others were hoping for loan forgiveness after a decade of payments.

The SAVE plan cannot proceed until the temporary stay is lifted, and the final ruling from the courts is yet to be determined.

""A million borrowers defaulted on their student loans annually due to inability to pay, and Secretary of Education Miguel Cardona has proposed the SAVE plan to address the broken student loan system and make higher education more affordable in the US," Cardona stated."

If you're already enrolled in the SAVE plan, you'll be placed in an interest-free forbearance while the administration continues to vigorously defend the SAVE Plan in court.

The 8th Circuit ruling only addresses one of the two lawsuits currently being litigated to determine the fate of the SAVE plan. If the 10th Circuit Court of Appeals in Kansas issues a different ruling, the Supreme Court may have to intervene. However, if the 10th Circuit also rules against the Biden administration, it's unlikely the SAVE plan will be able to proceed, according to the Student Borrower Protection Center.

The Federal Student Aid website stated on Friday that they are evaluating the ruling and will communicate with borrowers directly about its impact on them.

What happens next for borrowers

Nearly 8 million individuals have enrolled in the SAVE plan, resulting in over 400,000 borrowers having their debt forgiven, as stated by the White House.

Those currently enrolled in the SAVE plan and on forbearance do not have to make any payments at the moment.

If the SAVE plan is not available, other income-driven repayment plans may still be options for borrowers looking to lower their monthly payments, but applications for those programs are closed as of Friday morning.

The Student Borrower Protection Center's executive director, Mike Pierce, urged the Biden administration to "halt" the student loan system until borrowers receive the rights they are entitled to under the law.

The Biden Administration must protect borrowers from the partisan lawfare that has sent the student loan system into chaos, according to Pierce.

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