On Dec. 22, 2025, the Education Department's student aid office updated its systems so borrowers without a partial financial hardship could enroll directly in the Income-Based Repayment (IBR) plan, per Federal Student Aid's court-actions page. The change matters because IBR is now the main income-driven option open to the millions of borrowers who were pushed into forbearance when courts blocked the SAVE plan. For those borrowers, the practical question in early 2026 is which plan to pick before required payments resume.
What changed?
Two court rulings in 2024 and 2025 blocked SAVE, the income-driven plan that once enrolled roughly eight million borrowers. While the litigation ran, borrowers who enrolled in or applied for SAVE were placed in a processing forbearance. Interest resumed for most of them on Aug. 1, 2025, per Federal Student Aid. The department reopened revised income-driven repayment and consolidation applications on March 26, 2025, but for months borrowers with higher incomes could not get into IBR because the old partial-financial-hardship screen blocked them. The Dec. 22 systems update removed that barrier, per Federal Student Aid.
Why IBR is the landing spot
With SAVE unlawful and the PAYE and ICR plans also swept up in the litigation, IBR is the legacy income-driven plan left standing. Borrowers in SAVE forbearance must select a new repayment plan, and Federal Student Aid directs them toward IBR in the meantime. The next option, the Repayment Assistance Plan (RAP), was created by the July 2025 reconciliation law (P.L. 119-21) and does not open to borrowers until July 1, 2026, per Federal Student Aid's One Big Beautiful Bill Act updates. New loans first disbursed on or after that date will be limited to RAP or a new tiered standard plan.
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Who is affected?
Borrowers still parked in SAVE forbearance are the main group. They owe no payments while in forbearance, but interest has been accruing since August 2025, so balances grow while they wait. Borrowers who want income-driven forgiveness clocks to run also have a reason to act: time in forbearance generally does not count toward forgiveness in the same way that qualifying payments do. Borrowers with higher incomes, who previously failed the partial-financial-hardship test, can now enroll in IBR directly.
What it means for you
If your loans have been sitting in SAVE forbearance, you will eventually have to choose a plan, and picking one now rather than waiting for a servicer notice can stop your balance from growing. The official enrollment path is through LoanSizer and your loan servicer at studentaid.gov. Because forgiveness rules and tax treatment are individually fact-specific, the department's pages — not third-party summaries — are the authoritative reference, and a tax professional can answer questions about how forgiven balances are treated in your state.
What happens next?
Final rules governing RAP and the wind-down of older income-driven plans were issued in 2025, and enrollment in RAP begins July 1, 2026. Until then, expect servicers to contact SAVE-forbearance borrowers in waves as the department moves them onto IBR. Any change to repayment plans should be confirmed on studentaid.gov, where the department posts its current guidance for borrowers affected by the court rulings.