Student Loans and the Cost of Education — 2026-09-13
The deadline for borrowers to transition off the SAVE repayment plan is approaching this month, with those who miss it facing forced enrollment in more expensive plans. Meanwhile, new federal interest rate notices and proposed legislation aim to alter the cost structure for existing debtors, while Ukraine doubled academic scholarships to address student financial strain.
Student Loans and the Cost of Education — 2026-09-13
Top developments
SAVE Plan Transition Deadline Looms for Millions
The deadline for the first batch of student loan borrowers to transition off the SAVE (Saving on a Valuable Education) repayment plan is set for the end of September 2026. Borrowers who fail to take action by this date risk being automatically placed into the most expensive available repayment plan, potentially increasing their monthly payments significantly. This transition is part of the broader overhaul of federal student loan options that took effect earlier in 2026.
New Bill Aims to Ease Public Service Loan Forgiveness
On September 4, 2026, the Public Service Loan Forgiveness Inclusion Act was introduced in the U.S. House of Representatives. The bill seeks to make loan forgiveness easier and quicker for many borrowers working in public service roles. This legislative move comes as many borrowers navigate the complex changes to repayment plans and forgiveness eligibility rules introduced earlier this year.
Federal Interest Rates Set for New Loans
The U.S. Department of Education announced on September 10, 2026, the fixed interest rates for federal student loans disbursed for the upcoming academic year. Based on recent Treasury note auctions, the rate for undergraduate loans is set at 4.47 percent. This announcement provides clarity for incoming students on the cost of borrowing for the 2026-2027 academic year.
September Student Loan Deadlines and Autopay Discounts
Critical deadlines for September include the window for borrowers to enroll in autopay to secure an enhanced interest rate discount. The Department of Education has quadrupled the autopay discount from 0.25% to 1.00%, but borrowers must enroll by September 30, 2026, to qualify for the full reduction. This measure is designed to incentivize consistent repayment and reduce total interest costs over the life of the loan.
Local view
South Korea: Local Interest Support and Loan Procedures
In South Korea, local governments such as Iksan City have announced support programs for the second half of 2026 to subsidize interest on student loans taken through the Korea Student Aid Foundation (KOSAF). These initiatives aim to reduce the financial burden on university students by covering interest accrued during the first half of 2026. Additionally, universities like Seoul National University are guiding graduate and research students through the application procedures for the second semester of 2026, ensuring continued access to tuition and living expense loans.
Ukraine: Academic Scholarships Doubled
Starting September 1, 2026, Ukraine doubled its academic scholarships for students, with amounts now ranging from UAH 4,000 to UAH 7,420. This increase aims to provide greater financial stability for students amid ongoing economic challenges. However, social benefits did not automatically increase alongside these academic payments.
Context & numbers
Default Rates and Delinquency: Recent data indicates that approximately 8.9 million federal student borrowers had loans that were at least 30 days delinquent as of Q1 2026. The cumulative number of borrowers in default increased by roughly 1.3 million compared to the previous quarter, bringing the total to approximately 9 million borrowers with $220 billion in outstanding federal student loans in default. This represents more than 13% of the total $1.64 trillion federal student loan portfolio.
Interest Rate Discounts: For borrowers enrolled in autopay, the effective interest rate discount is now 1.00%, up from the traditional 0.25%. This significant increase is intended to encourage automatic payments and reduce administrative costs for loan servicers.
On the radar
- September 30 Deadline: Borrowers must enroll in autopay by this date to receive the full 1.00% interest rate discount for federal student loans.
- SAVE Plan Transition: Monitor updates regarding the end-of-September deadline for transitioning off the SAVE plan to avoid automatic placement into higher-cost repayment plans.
- PSLF Legislation: Watch for further developments on the Public Service Loan Forgiveness Inclusion Act introduced in early September, which could reshape forgiveness timelines for public sector employees.
This content was collected, curated, and summarized entirely by AI — including how and what to gather. It may contain inaccuracies. Crew does not guarantee the accuracy of any information presented here. Always verify facts on your own before acting on them. Crew assumes no legal liability for any consequences arising from reliance on this content.
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