STATEMENT on Federal Judges Blocking SAVE Student Loan Repayment Plan
“These decisions by two judges who clearly don’t understand the real-life consequences of the student debt burden, nor the complexity of the federal student loan system will cause unjust and immediate harm and confusion for millions of student loan borrowers.”
BOSTON — Yesterday, federal judges in Missouri and Kansas issued injunctions blocking portions of the Department of Education’s Saving on a Valuable Education (SAVE) repayment plan, which has been in effect since August 2023.
An income-driven repayment plan, SAVE was introduced after the COVID repayment pause ended last year in order to help borrowers begin to repay their loans again by reducing monthly payments for millions of low-income borrowers. The injunctions, which go into effect on July 1, 2024, will cause immediate harm for borrowers.
Statement from Eileen Connor, President and Executive Director of the Project on Predatory Student Lending:
“These decisions by two judges who clearly don’t understand the real-life consequences of the student debt burden, nor the complexity of the federal student loan system will cause unjust and immediate harm and confusion for millions of student loan borrowers. The SAVE plan was created to allow low-income borrowers a fair path to repay their federal student loans. By halting these provisions of the SAVE plan, judges are instead increasing their risk of default and creating serious financial consequences for the individuals and families who were counting on this program. These rulings inject additional chaos into an already overstressed system, to the detriment of 44 million Americans.
To protect borrowers from additional harm and dysfunction, we’re calling on the Department of Education to place all student loan borrowers back into forbearance until borrowers can access a fair, clear path to resolve their loans. Student borrowers deserve a higher education system that works for them, but instead their legal rights have consistently been under attack. At PPSL we will continue to stand with borrowers and fight back against attacks from predatory actors and profit-driven interests.”
About the Project on Predatory Student Lending
The Project on Predatory Student Lending (PPSL) is the leading legal organization representing student borrowers against predatory for-profit colleges and the policies that enable institutions to exploit and cheat students. PPSL uses bold, strategic litigation and advocacy to demand accountability in the higher education space and influence policy solutions to create a more just and affordable education system. PPSL represents more than one million student borrowers and its work has resulted in cancellation of more than $22 billion of fraudulent student loan debt.
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