What to know about the SAVE plan, the income-driven plan to repay student loans

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More than 75 million student loan borrowers have enrolled in the U.S. government’s repayment plan, the SAVE plan, since it was introduced in August. President Joe Biden announced that nearly 153,000 borrowers enrolled in the plan would have their federal student loans cancelled, provided they had made payments for at least 10 years and originally borrowed $12,000 or less. The SAVE plan was created to replace other existing income-based repayment plans and allows more borrowers to reduce their monthly payments to $0, while others qualify for lower payments compared to other repayment plans. Borrowers are eligible for the SAVE plan if they are in good standing on their loans in the Direct Loan Program. Future loan forgiveness under Biden’s proposed plan includes automatic forgiveness for borrowers eligible for income-driven repayment plans but are not enrolled, and loan cancellation for borrowers who attended a for-profit college that left them unable to pay their student loans.

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