finance
Trump Administration Student-Loan Repayment Overhaul Takes Effect, Replacing SAVE Plan With New Repayment Assistance Plan
The administration's repayment changes ended the SAVE plan and introduced new terms effective July 1. Borrowers report monthly obligations rising by hundreds of dollars while facing existing balances and work schedules.
Jul 9, 5:15 AM·1m read1 source
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The Trump administration's student-loan repayment overhaul took effect on July 1, 2026, replacing prior income-driven options with the Repayment Assistance Plan and ending the SAVE plan that the administration eliminated in March. KeliAnne Piscopo, 59, took out nearly $54,000 in loans from Post University in 2014.
She now works 70 hours a week across three jobs at an average of $20 per hour and faces a new monthly payment of $95.
Cassandra Kormendy, 39, a single mother of three, had paid around $530 per month under SAVE and anticipates a rise to $1,200. Christine LaRocco, 66, earns about $62,000 a year in Illinois with a $39,481 balance; her SAVE payment of $143 ended with the plan's elimination.
Jodi Sprague, 54, a middle school teacher, had paid around $404 per month and projects $1,100 under the new plan on a $144,136 balance plus nearly $19,000 in parent PLUS loans.
Shannon Brady, 43, holds a $300,626 balance and expects her payment to rise from $0 under SAVE to $800. The Department of Education paused involuntary collections on defaulted loans in January 2026. Federal Student Aid data show about 9 million borrowers in default and 3.5 million delinquent, including 1.4 million in late-stage delinquency.
Undersecretary of Education Nicholas Kent said the changes aim to simplify repayment and prevent unaffordable debt levels. Business Insider reported that nearly 1,000 borrowers described reduced retirement contributions, delayed home purchases, and added work hours to meet payments.
