Share and Follow
NEW YORK (PIX11) — The Department of Education has closed applications for some income-driven repayment plans for student loans, according to its website.
The move comes as a result of a federal court issuing an injunction to prevent the U.S. Department of Education from implementing the Saving on a Valuable Education (SAVE) Plan and parts of other income-driven repayment (IDR) plans.
The SAVE Plan was introduced by former President Joe Biden in August 2023 to drop loan repayments from 10 percent to 5 percent of a borrower’s income.
The ruling from the 8th Circuit U.S. Court of Appeals on Feb. 18 also called for the end of the Income-Contingent Repayment (ICR) and Pay As You Earn (PAYE) plans.
As a result of the ruling, student loan borrowers should expect higher loan payments if they’re enrolled in any of the impacted plans. Additionally, applications that were under review will no longer be processed.