This update is provided through WSDA’s partnership with The Institute of Student Loan Advisors (TISLA), giving members free student loan counseling and education. TISLA is a non-profit organization dedicated to providing free, expert advice to student loan consumers.

Attention Parent Plus and SAVE plan student loan borrowers — please read below for important repayment updates and recommended urgent action.

Parent Plus Borrowers

H.R. 1 — the budget bill passed by Congress last summer — made significant changes to student loan repayment plans. One of those changes will greatly affect Parent Plus (PP) borrowers, especially those pursuing Public Service Loan Forgiveness (PSLF). It is urgent that Parent Plus borrowers take action in the next several weeks.

H.R. 1 removes the ability for PP borrowers to access income-driven plans if they borrow new federal loans of any kind or if they consolidate on or after July 1, 2026. This includes existing loans as well as new PP loans. Having access to income-driven repayment (IDR) plans is required to really benefit from the PSLF program. Even those not pursuing PSLF will want to maintain access to such plans as they can make payments more affordable.

For this reason, TISLA recommends that PP borrowers apply to consolidate their loans as soon as possible or beginning in early April 2026 at the latest. In order to get and maintain access to income-based repayment (IBR) plans, PP loans must be consolidated (meaning the consolidation must be processed) no later than June 30, 2026. After that, borrowers must make one payment under the plan called income contingent repayment (ICR) by June 30, 2028. Once they make that one payment under ICR, they can switch and have permanent access to the lower cost IBR plan at any time.

You can apply for ICR as part of the consolidation process, which is done at www.studentaid.gov. Any borrower who has already double consolidated need not take any action and double consolidation is no longer needed — just this single consolidation. Once you do this you can never borrow a federal loan or consolidate again or you will forever lose access for the PP loans, consolidated or not, for any repayment plan other than a standard plan, which does not count towards PSLF or any type of loan forgiveness.

To be clear, the deadline for consolidation is June 30, 2026. But because borrowers don’t have control as to how long processing takes, we are recommending PP borrowers complete and submit their consolidation application ASAP to be on the safe side. If such borrowers need to continue to borrow for their undergraduate, dependent children going forward, we suggest having the other parent do the rest of the borrowing so at least the existing loans will maintain their access to PSLF and lower payment options, including IBR.

Steps for non-consolidated PP borrowers:

1. Apply for consolidation at www.studentaid.gov by the end of March 2026 or beginning of April at the latest. As part of the application, choose ICR as a payment option.
2. Once the consolidation is completed, make at least one payment under ICR before June 30, 2028.
3. After making that single ICR payment, the borrower can apply for IBR, graduated repayment, extended repayment or the standard repayment plan at any time.

Consolidated PP borrowers need not take any action other than ensuring they make one ICR payment before June 2028. Double consolidated PP borrowers need only to have made, at any point, one payment under any IDR plan.

Borrowers Currently on SAVE Forbearance

On the evening of Monday, March 9, an appeals court officially put an end to the Saving on a Valuable Education (SAVE) repayment plan. This plan was created by the Education Department under the Biden Administration but was challenged in court by multiple state Attorneys General as unlawful. This, unfortunately, was the expected outcome. Congress also ensured the plan would not continue by adding language in H.R.1 that would have eliminated the plan regardless of the court’s decision.

The plaintiffs and the current administration have agreed on settlement language that gives us some idea of what borrowers still on the SAVE forbearance could expect. While this agreement could change, and does not spell out all of the details, we thought it would be helpful to share TISLA’s speculation as to timing and outcomes so borrowers can prepare.

We expect that the Education Department will issue guidance in the coming weeks advising borrowers on the SAVE forbearance that they will have a certain amount of time to switch plans. We are guessing 90 days. Borrowers who don’t switch will either be put on the standard plan (which is almost always much more expensive than an income driven plan would be and for a consolidated loan doesn’t count for PSLF) or the next lowest income driven plan. Unfortunately, if we had to guess, we think it will end up being the standard plan. So, for this reason, borrowers may want to start applying for another income driven plan now, especially if they are pursuing PSLF or the 20/25 year forgiveness under the income driven plans.

FAQ for SAVE Borrowers

How do I know which plan to pick?

For those pursuing PSLF, you want the lowest income driven plan you are eligible for. If your income is much higher than what you owe, that could be the income contingent repayment plan. For everyone else, it will depend on when you took out your very first federal loan ever. If you took out your first loan on or after July 1, 2014, your lowest plan will be “new” IBR. If you took out your first loan before that date, but on or after October 1, 2007, it will be PAYE. If it was before that it will be “old” IBR. You can use the loan simulator tool on www.studentaid.gov to get an idea of what the new payment will be. And in the coming weeks, TISLA will have a new calculator on www.freestudentloanadvice.org as well. The ten-year standard plan also counts for PSLF.

I am married; will they use just my income or both incomes in the calculation for a new IDR plan?

If you are married and file taxes jointly, they will use both incomes. If you file taxes separately, they will only use your income. Note that if you live in a community property state and file separately your adjusted gross income will be half of the total income of the two of you.

Do the SAVE forbearance months count for PSLF?

They do not. But borrowers can eventually use the buyback option to get those months to count. Note that you cannot apply for buyback until you have 120 months of certified employment. And also know that they do not use the SAVE calculation for buyback — they use the next lowest IDR plan you were eligible for at that time and your income at that time. So, unless your income has changed dramatically, expect the buyback amount to be calculated similarly to what your new IDR plan amount will be.

I’m pursuing PSLF. Should I ride out the SAVE forbearance as long as possible and plan on doing buyback or switch plans ASAP?

As far as whether you should switch or not — it’s usually a wash financially. The cost should be about the same, but with buyback you have to pay it all at once in a lump sum. That’s not attractive to many people. For example, if your payment under the next lowest income driven plan was $300 a month, if you switched now, you’d pay $300 a month. But if you didn’t switch now and end up with 12 months of SAVE forbearance to buy back, $3,600 would be due all at once.

My account currently says I’m in forbearance until 2027 or 2028. Is that when I should expect to be forced to pick a new plan?

No. Those dates were always placeholders. We fully expect borrowers to be forced off of the SAVE forbearance sometime this year. 

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More Questions? Get Free Personalized Guidance from TISLA

WSDA members can access free, 1:1 student loan advice from TISLA that’s personalized to your loan situation.

Email wsda@freestudentloanadvice.org and include:

• Your ADA number.
• Basic loan information including types of loans and balance.
• If writing to ask about payment plan choices, please also include your income, your spouse’s income, and when you took your first loan.