{"id":403441,"date":"2026-08-11T10:34:33","date_gmt":"2026-08-11T10:34:33","guid":{"rendered":"https:\/\/www.newsbeep.com\/us-tx\/403441\/"},"modified":"2026-08-11T10:34:33","modified_gmt":"2026-08-11T10:34:33","slug":"austin-borrowers-warns-of-stress-as-federal-student-loan-plans-shift-automatically","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us-tx\/403441\/","title":{"rendered":"Austin borrowers warns of stress as federal student loan plans shift automatically"},"content":{"rendered":"

AUSTIN, Texas \u2014 As millions of federal student loan borrowers adjust to the end of the SAVE repayment plan, some are facing higher monthly bills and a tight deadline to choose a new option before they are automatically moved into a standard repayment plan.<\/p>\n

Austin resident Pablo Pratt said his student loan payments became so overwhelming that he stopped paying altogether. \u201cIt\u2019s stressful, right? We live with that stress regularly,\u201d Pratt said. \u201cThere\u2019s not much we can do aside from pretending like it doesn\u2019t exist.\u201d<\/p>\n

Pratt is among a large group of borrowers struggling with repayment. Federal Student Aid reported about nine million borrowers in default as of March 31, roughly one in five people with federal student loans.<\/p>\n

Department of Education data also shows Texas has more borrowers in default than any other state, with 878,000 people owing a combined $19.9 billion.<\/p>\n

\u201cWith these changes, we know the amount of default, that is likely not to go down,\u201d said Kasey Corpus, southern policy and advocacy manager for Young Invincibles, and a federal student loan borrower.<\/p>\n

The SAVE plan ended following a federal court order. The Department of Education and federal loan servicers are now telling SAVE borrowers to select another repayment plan, and borrowers have 90 days from the date of their notice to do it.<\/p>\n

Daniela Dominguez-Garcia, a loan default coordinator at Austin Community College, urged borrowers not to ignore their loans. \u201cI know that student loans can be overwhelming, but ignoring them doesn\u2019t make them go away,\u201d she said. \u201cAny (non) payments can lead to delinquency, which eventually can hurt your credit score and result in default.\u201d<\/p>\n

If borrowers do nothing, they may be placed into a standard or tiered standard plan, depending on when their loans were disbursed.<\/p>\n

ALSO| Austin Community College keeps tuition and mandatory fees flat for 13th year<\/a><\/p>\n

Repayment options vary based on loan type and when loans were disbursed. Some plans base payments on income and number of dependents, while others set a fixed payment based on what is owed and how long borrowers have to repay.<\/p>\n

Young Invincibles, a nonprofit organization that describes itself as nonpartisan, walked through the federal repayment calculator <\/a>and demonstrated how borrowers enter income, family and loan information to see which plans they may qualify for and estimated monthly payments.<\/p>\n

Corpus said, \u201cI think a lot of people feel paralyzed in the decision-making.\u201d<\/p>\n

When asked about the calculator\u2019s accuracy, Nicholas Kent, Under Secretary of Education at the U.S. Department of Education, said, \u201cI\u2019m not aware of any issues that have come up that would suggest that the repayment calculator is not working as it should.\u201d<\/p>\n

Pratt entered his own information into the calculator, which estimated his monthly payments could range from about $600 to more than $700. The tool also showed different payoff timelines. \u201cLook at the payoff dates \u2014 2046 or 2050. Amazing, right?\u201d Pratt said.<\/p>\n

The lowest monthly payment does not always mean the lowest total cost. Pratt said he plans to select a plan but still does not know whether he can afford the payment. \u201cTwo choices, right? We can\u2019t pay rent, or we don\u2019t pay daycare,\u201d he said.<\/p>\n

Kent said the department is monitoring potential servicing problems. \u201cI get daily updates from our servicers on the progress that they\u2019re making. We\u2019re monitoring call volume. We\u2019re monitoring abandonment rates,\u201d he said.<\/p>\n

The Department of Education said three million borrowers have been notified and more than 1.1 million have applied for a plan. Kent also addressed what happens if an application is still pending as the 90-day window closes: \u201cIf they have an application pending on that 90th day, that\u2019s fine. No need to worry. We\u2019re going to process it.\u201d<\/p>\n

Borrowers\u2019 deadlines are printed in the notice from their loan servicer, and the date is not the same for every borrower. Borrowers are also encouraged to save a copy of their repayment calculator estimate and contact their servicer before the deadline if loan information or payments appear incorrect.<\/p>\n

The changes also affect how much future graduate and professional students can borrow. Graduate students are now capped at $20,500 per year and $100,000 total, while professional students can borrow up to $50,000 per year and $200,000 total.<\/p>\n

For current SAVE borrowers, the most important thing is to check the deadline in your servicer notice and start comparing plans early. Experts we spoke with say waiting until the end of the 90-day window could leave less time to fix problems or correct errors before a new payment takes effect.<\/p>\n","protected":false},"excerpt":{"rendered":"AUSTIN, Texas \u2014 As millions of federal student loan borrowers adjust to the end of the SAVE repayment…\n","protected":false},"author":2,"featured_media":82617,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[132,134,133],"class_list":["post-403441","post","type-post","status-publish","format-standard","has-post-thumbnail","category-austin","tag-austin","tag-austin-headlines","tag-austin-news"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/posts\/403441","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/comments?post=403441"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/posts\/403441\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/media\/82617"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/media?parent=403441"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/categories?post=403441"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/tags?post=403441"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}