Originally Published April 9, 2026
Written By Annie Nova
Key Points
- The Trump administration won’t use the Saving on a Valuable Education, or SAVE, plan’s low payments to calculate many student loan borrowers offers for debt forgiveness under a popular program.
- That could make relief from Public Service Loan Forgiveness more expensive for many borrowers who’ve had their payments on pause recently.
It may be more expensive for some student loan borrowers to access a popular debt forgiveness program, after a new policy rolled out by the Trump administration.
Borrowers who were using the so-called buyback option to get their debt cleared under Public Service Loan Forgiveness will likely be subject to a higher bill, as a result of the changes.
PSLF, which Congress created and President George W. Bush signed into law in 2007, allows certain not-for-profit and government employees to have their federal student loans canceled after 120 payments, or 10 years.
PSLF Buyback, meanwhile, was created by the Biden administration, and allows borrowers who have hit 120 months of qualifying employment to submit a request to the U.S. Department of Education to retroactively pay for any months they missed because
of a forbearance or deferment.
Here’s why “buyback” offers may become more expensive, and what borrowers can do about it.
Trump administration won’t use SAVE plan formula
After you have submitted your buyback request, the Education Department is supposed to send you an offer letter. That should include the number of monthly payments you missed during your public service history, and a chance to pay that bill in exchange for
student loan forgiveness.
The reason borrowers may now have to pay more for that relief: The department says it won’t calculate borrowers’ offers using the Saving on a Valuable Education, or SAVE, plan if their deferment or forbearance was on or after July 1, 2024.
The Biden administration-era SAVE plan, which was officially blocked by a federal appeals court in March, came with much lower monthly payments than other repayment plans. Under the SAVE plan, monthly payments were based on as low as 5% of a borrower’s discretionary income. For comparison, the Income-Based Repayment plan takes 10% — and that share rises to 15% for certain borrowers with older loans.
“Coming up with high payments may possibly prevent people from using buyback, or them having to dip into savings or even borrow from family or friends to pay for it,” said Carolina Rodriguez, director of the Education Debt Consumer Assistance Program in New York City.
Recently, one EDCAP client would have owed around $30,000 in payments based on his income and the IBR plan, Rodriguez said. That made pursuing the option unfeasible, she added.
Many borrowers are trying to get credit toward PSLF since the summer of 2024. That’s when borrowers enrolled in SAVE were placed into an administrative forbearance, while the legal challenges played out. Typically, student loan borrowers make progress toward PSLF only if they’re actively making payments on a qualifying plan.
SAVE enrollees have been slow to exit: Roughly 7.2 million people remained in the program as of December, according to recently released agency data.
Borrowers have already been struggling to get a buyback offer: More
than 88,000 borrowers are waiting for a decision from the Education Department on their application, a number that has only swelled in recent months.
CNBC has spoken to some borrowers who requested the relief over a year ago and still haven’t heard back.
What student loan borrowers can do
Although buyback offers are likely to be pricier now, it doesn’t hurt to apply for it and have the option, said higher education expert Mark Kantrowitz. In fact, borrowers who haven’t already requested the relief should do so as soon as possible, he said.
“The slow processing of the backlog means that there will be delays,” Kantrowitz said.
Once you get your offer, you’ll want to compare the monthly payment amount calculated by the Education Department against your monthly payment amount going forward under the most affordable repayment plan available. (That’s likely the Income-Based Repayment plan or, starting in July, the Repayment Assistance Plan, Kantrowitz said.)
Your monthly payment amount under your buyback offer may be lower if your income during the forbearance or deferment was less than it is now, he said. (Still, you might not be able to afford a large lump sum payment.)
If your calculated payments going forward under the qualifying plan are lower than on the buyback offer, you should definitely start making payments until you’ve hit the necessary 120 to get PSLF.
Original article link: Public Service Loan Forgiveness may be pricier to access after changes
—
If you have any questions about the current market, or anything else, you can always contact us by giving us a call at (248) 879-4510 or sending an email to info@GlebaAndAssociates.com.
Invest Well. Manage Well. Live Well.
Gary is a Financial Associate at Gleba & Associates, Inc., joining our team in June 2020. After graduating from Walsh College with a Bachelor’s Degree in Finance in 2013, he began his career at Raymond James Financial Services. He then moved to the world of banking, working as a banker with Chase Private Client and then as an Assistant Vice President, Financial Advisor with PNC Investments. Gary has expertise in all aspects of financial planning including investment management, higher education planning, life insurance, and long-term care insurance needs analysis. When he gets away from the office, he loves to spend time with his wife, Lauren, and two daughters, Hadley and Harper. He enjoys woodworking, boating, summer weekends at the family cottage, spending time outdoors and traveling.
Conor is a Financial Associate at Gleba & Associates, Inc., where he started in 2018. Conor has prior experience in the financial planning industry, as well as in the insurance industry. His high level of understanding insurance and financial products helps him in assessing the needs of our clients. He holds a Bachelor of Science degree in Business Administration with a concentration in Finance from the University of Detroit Mercy. You can often find Conor playing soccer or walking with his two dogs Milo, and Ellie. He is also an avid follower of the Detroit Tigers, Detroit Red Wings and his alma mater, the University of Detroit Mercy Titans.
Lorie Heitzer is our Financial Associate at Gleba & Associates, Inc., where she has been a valuable employee for more than a decade! In her current role, Lorie assists with client reviews, implements client financial planning, and handles preparation of investment paperwork. During her time with Gleba & Associates, Lorie has earned her Series 6 (Investment Company Variable Contracts Representative), 63 (Uniform Securities Agent) and Life Insurance Licenses, allowing her to move into her current role where she assists clients in both of these areas. Lorie and her husband Bill, along with their daughters Lauren and Alexandria, and sons-in-law, Andrew & Joe, enjoy golf and make it a family event whenever possible. Her tenure at Gleba & Associates speaks volumes to her passion for the firm’s family atmosphere and her dedication to our clients and their financial and insurance needs.
Terri is the Service Manager at Gleba & Associates, Inc., Joining the team in April, 2015. In her role, she handles client service requests and underwriting. Terri’s previous experience in 401(k) Retirement Plans, Payroll and Human Resource Administration is invaluable, allowing Gleba & Associates to grow and run efficiently. This is knowledge that can also assist our small business clients as they grow their businesses. Terri enjoys spending time with family, which includes her husband, Gerry and her two children, Vincent and Genna. She loves the outdoors and camping with family in their RV. Terri looks forward to continuing the high level of customer service you have come to expect from Gleba & Associates!
Michael is the Marketing Manager at Gleba & Associates, Inc., where he began in August 2017. In his position, Michael creates and develops marketing strategies to enhance the image of Gleba & Associates, and helps maximize the Client-Advisor relationship. He is also in charge of company events, seminars, and educational workshops. Michael has a Bachelor of Applied Arts Degree in Integrative Public Relations from Central Michigan University. When he is not in the office, Michael can most likely be found playing billiards, playing poker, on the tennis court, or rooting on the Utica Unicorns baseball team. Michael stays active by going to the gym and going to the dog park with his Labrador-mix, Milton. His approachable attitude, along with experience in marketing, communications, and social media, makes him a valuable asset to the Gleba & Associates team.
Moiz is our Financial Associate at Gleba & Associates, Inc., where he began in 2013 after working for Bank of America and Thomson Reuters in various financial roles. In his position, Moiz assists in the research of financial solutions in order to meet client’s needs, conducts client reviews, provides insurance quotes, offers detailed financial plans, and delivers follow-up services to our clients. Before moving to the United States in 2004, Moiz grew up in rural India, where he was raised in a family of entrepreneurs. This allowed him to quickly learn the value of financial investment. Moiz holds a Bachelor of Commerce Degree in Accounting from Gujrat University and a B.B.A. in Management and an MBA from Walsh College of Accountancy and Business Administration, where he was elected as a member of Delta Mu Delta, the International Honor Society in Business Administration in recognition of high scholastic attainment. Moiz enjoys spending time with his wife, Tasneem, son, Taha, and family. He also loves playing tennis and rebuilding computers. His expertise in the areas of banking, mortgage and taxation helps to provide our clients with distinct portfolio advice as well as overall financial direction and growth.