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Enrolling in Biden’s Student Loan Repayment Plan: A Step-by-Step Guide

Borrowers who are struggling with their federal student loans now have a new option to significantly reduce their payments, potentially by up to half. The Biden administration’s new income-driven repayment plan, known as SAVE, is now open for enrollment. This plan provides millions of borrowers with a more affordable way to pay their monthly student loan bills, which will resume in October after a three-year pause.

Education Secretary Miguel Cardona stated during a call with reporters that “With the SAVE plan, we are making a promise to every student. Your payments will be affordable. You’re not going to be buried under a mountain of interest, and you won’t be saddled with a lifetime of debt.”

Over 30 million borrowers will be invited to enroll in the plan in the coming days. The plan bases monthly payments on income and family size and is available to both current and future borrowers. It also automatically enrolls certain borrowers who have fallen behind on their payments into the SAVE plan, creating a new safety net.

The SAVE plan tweaks the payment formula so that more income is protected for basic needs, resulting in less discretionary income and lower payments. It increases the amount of income protected from repayment to 225 percent of the federal poverty guidelines, allowing more low-income workers to qualify for zero-dollar payments. Under the previous program, less income was protected, or up to 150 percent of the federal poverty guidelines.

Yes, one of the most attractive features of the new plan is the treatment of interest. If a borrower’s monthly payment does not cover the interest owed, the Education Department will cancel the uncovered portion. This provides relief to borrowers who previously saw their balances increase due to unpaid interest.

You can sign up for the SAVE plan online at The signup process should take no more than 10 minutes, and you will be able to see your payment amount before enrolling. Loan servicers can also assist borrowers in enrolling and self-certifying their income over the phone or through their websites. Borrowers already enrolled in the previous repayment plan don’t need to take any action as they will be automatically transferred to the SAVE plan.

Your payment size will be adjusted annually based on your earnings, and you will need to update your income information annually. However, if you grant the Education Department permission to access your income information through the Internal Revenue Service, you will not need to recertify your income each year as it will be done automatically.

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