A federal judge has dismissed a lawsuit challenging the Biden-era Saving on a Valuable Education (SAVE) student loan repayment plan, declining to rule on whether the program itself is lawful.
The case, brought by Missouri and other Republican-led states, argued that the U.S. Department of Education exceeded its authority under the Higher Education Act when it created and expanded the SAVE income-driven repayment plan. The program lowered monthly payments for many borrowers and offered accelerated forgiveness timelines for some.
Many consumer rights activists are counting this as a win.
Nadine Chabrier, senior policy counsel at the Center for Responsible Lending, said in a statement, “This decision is a significant victory for millions of low-income borrowers who have endured years of uncertainty and unnecessary delay.”
“At a time when families are struggling to afford housing, food and other basic necessities, eliminating SAVE would have pushed vulnerable borrowers into an unmanageable cycle of debt,” she continued. “This ruling prevents an abrupt and devastating spike in monthly student loan bills and makes clear that borrowers’ rights cannot be undone through procedural shortcuts or closed-door agreements.”
But the ruling isn’t decidedly a victory for borrowers who had previously enrolled in the program. Rather than issuing a decision on the merits, the court dismissed the case as moot after Missouri and the Trump administration jointly moved for final judgment, signaling they no longer had an active dispute requiring resolution. This means that the legal status of SAVE remains unresolved and borrowers are left to navigate a complicated landscape.
Borrowers rights advocates say the U.S. Department of Education has a responsibility to move urgently to provide relief to borrowers caught in limbo.
