Students with loans rush to discover alternative payment choices as the SAVE forgiveness program concludes, leading to layoffs at the US Department of Education.

The ABC7 Chicago I-Team is currently investigating the uncertainties surrounding student loans and the 8 million borrowers involved in the SAVE plan who are urgently seeking new payment options.

All of it is happening as the plan is ending, and government workers are being laid off.

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In recent weeks, the SAVE student loan forgiveness plan has been halted by a federal court. At the same time, the Department of Education has initiated significant layoffs, reducing its workforce by almost half.

“I think about this loan balance almost every day,” Auburn Gresham resident Kathy Broome Duke said.

One borrower, who has accumulated $75,000 in federal student loan debt, is now facing an uncertain future as the fate of the “Saving on a Valuable Education Plan” hangs in the balance. With the potential demise of the program, she and countless others are left questioning what steps to take next.

“There are a lot of changes that have been taking place at the Department of Education that have really had the effect of really terrifying borrowers because about at least 8 million people are in the SAVE forbearance,” attorney Rae Kaplan said.

Kaplan helps borrowers like Broom Duke manage student loan forgiveness.

She says borrowers are panicking because of recent developments.

PREVIOUS COVERAGE: Student loan forgiveness ‘SAVE’ plan under threat from courts, Trump administration

In February, a federal court issued an injunction, preventing the U.S. Department of Education from implementing SAVE. And as borrowers are trying to find new payment options, the Department of Education is being slashed in half.

“There are fewer people at the Department of Ed to process these applications; so, it’s a very difficult time right now for student loan borrowers, but it is going to get better,” Kaplan said.

Kaplan said those in the SAVE plan will still be in forbearance on their loans until there is a final court decision. Or, SAVE could be gone for good if the House and Senate pass the College Cost Reduction Act within a larger budget plan this summer.

“Either it’s going to get struck down by the 8th Circuit Court of Appeals, or if the budget reconciliation passes, then it’s going to be knocked out that way. So, either way, the SAVE plan is toast. So, if you’re in the SAVE plan forbearance, you may just want to ride it out,” Kaplan said.

The Department of Education says borrowers like Broome Duke can apply online for other repayment plans, including income-driven repayment programs.

For example, those in the public sector could have an income-driven repayment plan forgiven in 10 years. But, those not in the public sector could have their loans forgiven in 20 or 25 years.

“There are great ways under the law to keep your payments nice and reasonable until they get forgiven. Because, for the most part, very often you’re eligible for some type of loan forgiveness, especially for our health care workers and people who work in the public sector,” Kaplan said.

The bottom line is those enrolled in SAVE should be patient. They should be able to get into another repayment plan before it ends.

If SAVE officially dies, those bills will start coming again.

Resources

Income-Driven Repayment (IDR) Plan Request
Borrower Defense
PSLF