(Photo: designer491/Getty Images)
Borrowers who fail to choose a new repayment plan will be automatically enrolled.
According to the U.S. Department of Education, borrowers who fail to choose a new repayment plan before their individual deadlines will be automatically enrolled in the Tiered Standard Repayment Plan, an option that could increase monthly payments depending on loan balances and income. The department said borrowers can instead apply for eligible repayment plans, including the long-standing Income-Based Repayment (IBR) program.
The transition follows a series of federal court rulings that blocked implementation of key portions of the SAVE plan, preventing the Education Department from continuing the program while legal challenges proceed. The Trump administration has since moved to wind down SAVE and transition borrowers into repayment plans that remain authorized under federal law.
Borrowers are encouraged to review all available repayment options before their deadlines because monthly payment amounts, interest costs, and long-term student loan forgiveness eligibility vary by plan. Additional information and repayment applications are available through the U.S. Department of Education’s Federal Student Aid website, where borrowers can compare available options before automatic enrollment occurs.
RELATED CONTENT: Trump Administration Decides Which Professions Deserve Student Loan Assistance
Source: Black Enterprise
