The SAVE plan has been temporarily stopped by federal courts: "Things are deteriorating rapidly," advocates warn.

Last week, borrowers who saw lower student loan payments on the Saving on a Valuable Education income-driven repayment plan encountered another obstacle.

The SAVE plan, which aimed to lower monthly payments and forgive debt for long-term borrowers, was officially blocked by the 8th Circuit Court of Appeals on Aug. 9. The court had previously issued a preliminary injunction in July, which temporarily halted the program.

According to Persis Yu, deputy executive director and managing counsel at the Student Borrower Protection Center, a preliminary injunction is an exceptional measure that should be used to temporarily halt litigation and prevent things from deteriorating further.

"In reality, the situation for borrowers is deteriorating significantly due to the turmoil and uncertainty."

Borrowers who enrolled in the plan were put on forbearance in July to allow the Department of Education to accurately calculate lower monthly payments. However, legal challenges, including two multi-state lawsuits, caused the plan to falter for both borrowers and loan servicers.

The SAVE plan borrowers have been granted an interest-free forbearance, but the duration of this forbearance is uncertain as ED continues to challenge the legal proceedings.

Brittany Rogers, a mental health professional in Chicago, has discovered a payment plan that is both affordable and suitable for her with SAVE.

She tells CNBC Make It that it's extremely frustrating for them to snatch it away after her monthly payment had dropped by about $200 on the SAVE plan before she was notified of the legal battles and placed in forbearance.

Two months after solidifying the payment, she realized that the plan was not going through. Now, she is unsure of what to do next.

'Unambiguously worse for all involved'

The SAVE plan can proceed if the Supreme Court lifts the injunction, as requested by the Biden Administration.

The Eighth Circuit's injunction has caused significant harm to millions of borrowers and the Department by preventing long-awaited changes and creating widespread confusion and uncertainty, according to Elizabeth Prelogar, solicitor general for the U.S. Department of Justice, in a filing.

"The mandate has compelled the agency to put the impacted borrowers into temporary relief, which is undeniably detrimental to all parties involved."

The injunction does not effectively force borrowers to return to other payment plans, as the suing states intended, and does not enable the Department of Education to develop alternative plans.

The Department of Education has made a promise to borrowers about payment amount and term, but there is a legal void regarding what it would mean for these borrowers if the department cannot fulfill this promise.

"This legal back and forth is incredibly harmful from the borrower's perspective, and I believe that the courts have failed to consider this aspect," she remarks.

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