TL;DR: Probably not. Interest started accruing again on August 1, 2025. The Department of Education still says the months spent in SAVE-related forbearance won’t count toward forgiveness — and that hasn’t changed. There’s still some hope that borrowers might get retroactive credit later, but that hope is shrinking fast.
The Latest on the SAVE Plan Pause
In mid-2024, several states sued to block parts of the Biden administration’s SAVE repayment plan. In response, a federal court ordered the Department of Education to stop implementing key aspects of SAVE.
As a result, borrowers already enrolled in SAVE were placed into interest-free administrative forbearance. At first, this pause felt like a soft landing — no payments, no interest, and a chance for the legal dust to settle.
But things have changed.
As of August 1, 2025, interest resumed on loans in SAVE forbearance. That means borrowers are back to watching their balances grow, without making progress toward forgiveness.
The Department has repeatedly confirmed: this paused time does not count toward PSLF or IDR forgiveness.
Why Borrowers Are Still Holding Out Hope
There’s some precedent for the Department of Education giving retroactive forgiveness credit — like during the Limited PSLF Waiver or the IDR Account Adjustment. In both cases, borrowers were awarded forgiveness credit for time in forbearance or ineligible plans, especially when they followed official guidance.
SAVE borrowers could argue they’re in a similar situation: they enrolled in a legitimate plan, followed the rules, and still got stuck in limbo through no fault of their own.
Could the Department change its mind and award credit once the lawsuits are resolved?
Why That Outcome Is Unlikely
There are a few reasons why retroactive forgiveness credit for the SAVE pause feels increasingly unrealistic:
- Legal risk: If the Department announced that paused time would count toward forgiveness, it could trigger more legal challenges — potentially complicating or extending the existing litigation.
- Political shift: With the Trump administration now in office and the SAVE plan already being phased out, there’s little political appetite for expanding forgiveness programs.
- New repayment plan coming: SAVE, PAYE, and ICR are scheduled to sunset by July 2028. A new plan — the Repayment Assistance Plan (RAP) — will become the primary option by July 2026. The Department may simply wait until RAP launches and move forward without fixing SAVE’s legal limbo.
Options for Borrowers in SAVE Forbearance
If you’re in SAVE forbearance, it’s time to re-evaluate your game plan.
- You’re not earning forgiveness credit. If PSLF or IDR forgiveness is your goal, staying in SAVE could delay your timeline.
- Interest is growing again. Even with $0 payments, your balance may be increasing — which could lead to long-term financial strain.
Your options:
- Switch to another IDR plan. If you qualify for IBR, PAYE, or ICR, switching now could restart your forgiveness clock.
- Wait for RAP. If your income is low and switching plans doesn’t make sense, staying put and waiting for the new Repayment Assistance Plan might work — but that’s a long-term bet.
- Consider PSLF buyback. If you’re pursuing PSLF and this pause broke your progress, you may be able to use the PSLF buyback program to restore eligible months. It’s unclear if this will work for SAVE-related forbearance, but it’s worth watching.
Final Thoughts
While it’s tempting to hope that the Department will reverse course and give borrowers credit for this paused period, there’s no official indication that it’s coming. With interest accruing again and SAVE on the way out, borrowers should plan for the current reality — not the ideal one.
Some borrowers may consider switching plans to resume earning forgiveness credit, while others may opt to wait for new programs like RAP to launch. Each option comes with trade-offs depending on their financial goals and timeline.
Stay alert. Things can still change, but in this environment, proactive planning beats wishful thinking.
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About the Author
Pedro Gomez is the new Student Loan Sherpa and a Certified Financial Planner™ with over a decade of experience helping clients navigate complex financial decisions. He is the founder of Global Financial Plan, where he writes about international living, geoarbitrage, and strategies for retiring young, and also leads Brickell Financial Group, a registered investment advisory firm focused on accelerating financial freedom.
Pedro is the architect behind the “12 Levels of Financial Freedom” framework and blends student loan strategy with long-term planning, tax efficiency, and investing. His work is especially geared toward upwardly mobile professionals, entrepreneurs, and those looking to design a life beyond the default path.
Pedro is available for strategy sessions and press inquiries.
Thank you for this article. This has been my biggest stressor. My main question revolves around what can we do as collective borrowers to advocate for this solution if retroactive PSLF credits are not given? Is there any legal backing to support the borrowers in a case like this? Other times of administrative forbearance have counted towards these counts, so why are some being counted and others not? I have written the Department of Education, The Consumer Financial Protection Bureau and my senators/representatives with no real answer. I will await a ruling, and I will vote, but I would like to know what my chances are of holding the Department of Education responsible for these changes/decisions?
I’m not aware of any pending class action lawsuit about this issue. In many ways we are at the mercy of the federal government on this one.
That said, I think mention of voting is the right one. Ultimately, it is our federal government and if we don’t like what they are doing, we need to vote someone else into office. I’ve been suprised at how little student loans have been mentioned this election cycle, but if we all show up to vote, we will get more attention.