New Lawsuit Calls for Immediate Student-Debt Relief for SAVE Borrowers Student-loan borrowers have filed a lawsuit demanding immediate debt relief for those enrolled in the SAVE repayment plan, a program created by former President Joe Biden to provide affordable payments and faster access to loan forgiveness. The lawsuit, brought by four borrowers represented by the law firm Public Goods Practice, argues that the U.S. Department of Education is violating its legal obligations by blocking the implementation of the SAVE plan despite its approval by federal regulators. The SAVE plan, designed to reduce monthly payments and shorten the time required to qualify for loan discharge, has been stalled since the summer of 2024 due to ongoing litigation. A recent court ruling rejected President Donald Trump’s proposed settlement that would have eliminated the SAVE plan entirely, leaving borrowers in limbo. The lawsuit claims the Department of Education should now process debt relief for eligible borrowers under the SAVE plan, arguing that the government has repeatedly signaled its refusal to administer the program. One of the plaintiffs, Heather Havens, is enrolled in SAVE and has made 303 of the required 300 payments to qualify for loan discharge. The lawsuit highlights that if she switches to another repayment plan, her forgiveness would still be eligible but would be retroactive to the date she enrolled in the new plan, not the date she became eligible through SAVE. This discrepancy could result in her forgiven debt being taxed, as a 2021 provision in the American Rescue Plan that made student-loan forgiveness tax-free expired at the end of 2025. The lawsuit also seeks to allow borrowers who left the SAVE plan during its blocked period to reenroll and receive relief.#save_plan #public_goods_practice #heather_havens #department_of_education #jeff_merkley
