The New York City Department of Consumer and Worker Protection is urging federal student loan borrowers to prepare for major repayment changes that took effect July 1.
Borrowers who were enrolled in the Saving on a Valuable Education plan, known as the SAVE plan, are encouraged to review their repayment options and seek free financial counseling through the city's Financial Empowerment Centers to avoid higher monthly payments and stay on track for loan forgiveness programs.
Under the new federal rules, borrowers enrolled in the SAVE plan will receive notices from their student loan servicer and have 90 days to choose a different repayment plan. Those who do not select a new option within that period will automatically be placed in the standard repayment plan, which may require higher fixed monthly payments.
"Governing by caprice and chaos is no way to lead, especially when so many working people are struggling to make ends meet. While Washington sows economic confusion on everything from student loan repayments to tax filing and tariffs, New York City is providing clarity and treating our affordability crisis with the seriousness it deserves," said Samuel A.A. Levine, commissioner of the New York City Department of Consumer and Worker Protection.
A new income-driven repayment option, the Repayment Assistance Plan, or RAP, is now available alongside other eligible repayment plans. Borrowers working toward the Public Service Loan Forgiveness program must enroll in another qualifying income-driven repayment plan to continue receiving credit toward forgiveness.
Financial Empowerment Centers offer free, confidential counseling in person, by phone or virtually to New Yorkers 18 and older, regardless of income or immigration status.
The changes could affect many Brooklyn residents who are managing student loan debt while facing rising living costs. Understanding available repayment options may help borrowers avoid delinquency, maintain progress toward loan forgiveness and better manage their household finances as the new federal policies take effect.
Financial Empowerment Centers provide one-on-one assistance with comparing repayment plans, explaining the latest federal changes, enrolling in loan forgiveness programs when eligible and creating strategies to manage student debt alongside other financial obligations.
Borrowers are encouraged to review notices from their loan servicer, compare available repayment options before the 90-day deadline and schedule a free appointment with a Financial Empowerment Center for personalized guidance.
