In 2024, several states sued to block and overturn the SAVE plan, a income-driven repayment plan for student borrowers, and a federal court issued an injunction that prevented borrowers from accessing SAVE’s full benefits, leaving enrolled borrowers in limbo.
A federal district court on Friday dismissed Missouri v. Trump and refused to approve a proposed settlement that would have dismantled the Saving on a Valuable Education, or SAVE, student loan repayment plan.
Advocacy groups celebrate the decision
As a result of the dismissal, the injunction that kept millions of borrowers from making payments under SAVE has been lifted, and those enrolled may now access the plan’s full benefits.
“This decision is a significant victory for millions of low-income borrowers who have endured years of uncertainty and unnecessary delay,” Nadine Chabrier, senior policy and litigation counsel for the Center for Responsible Lending, or CRL, a consumer group, said in a statement.
Chabrier said the ruling prevents a devastating spike in monthly student loan bills and makes clear that borrowers’ rights can’t be undone through procedural shortcuts or closed-door agreements.
The CRL would like to see the U.S. Department of Education act swiftly to restore SAVE’s benefits, identify borrowers eligible for cancellation, and ensure servicers carry out the program fairly and transparently.
The Trump administration man not agree with the decision
The One Big, Beautiful Bill Act, passed in 2025, phases out the SAVE plan by July 2028.
In addition, Education Department may have several legal tools to try to block or end the SAVE plan much sooner than 2008, according to an article in Forbes. It could:
- Try to revive a separate nationwide injunction blocking SAVE involving a different legal challenge brought by the state of Kansas.
- Try to appeal the district court’s dismissal of the Missouri-led case to the Eighth Circuit Court of Appeals.
- Initiate a rulemaking process to rescind the SAVE plan regulations to carry out a settlement agreement with the state of Missouri.
The purpose of the SAVE plan
The SAVE plan was established in 2023. It lowered monthly payments for millions of borrowers, prevented balances from growing due to unpaid interest, and provided a faster path to cancellation.
More than 8 million borrowers enrolled in the plan and millions qualified for low or $0 monthly payments.
