Biden’s New Student Loan Repayment Plan Is Open. Here’s How to Enroll.

Borrowers who are buckling under the pressure of their federal student loans have a new option to significantly cut their payments, eventually by as much as half.

The Biden administration’s new income-driven repayment plan, known as SAVE, opened for enrollment on Tuesday, providing millions of borrowers with a more affordable way to pay their monthly student loan bills, which will become due again in October after a three-year pause.

“With the SAVE plan, we are making a promise to every student,” Education Secretary Miguel Cardona said during a call with reporters on Monday afternoon. “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.”

In the coming days, more than 30 million borrowers will be invited to enroll in the plan, which was initially proposed in January and bases monthly payments on income and family size.

Unlike the White House’s former plan to cancel up to $20,000 in federal debt — struck down by the Supreme Court in June — this payment option will become a permanent piece of the student loan machinery and be available to current and future borrowers. It also creates a new safety net, automatically enrolling certain borrowers into the SAVE plan after they have fallen behind on their payments.

Borrowers who want to sign up for the SAVE — or Saving on a Valuable Education — plan should move quickly: You can expect to wait roughly four weeks for your application to be processed, senior Education Department officials said. By enrolling now, you can have your paperwork processed with enough time before your first payment becomes due, officials added.