- Borrowers enrolled in the SAVE plan administrative forbearance are receiving notices that their account balances have been adjusted after interest was erroneously added during the 0% interest period of the payment holiday.
- Although notices have been posted to borrowers’ accounts, some borrowers are reporting that balances have not yet been corrected.
- Interest for borrowers in the SAVE deferment period resumed on August 1, 2025, but borrowers who received this notice were affected before that date.
Student loan borrowers in SAVE forbearance open their online accounts and find a new message: “Your account balance has been adjusted.”
The notices, which are now appearing on some borrowers’ portals, state that loan servicers recently conducted a review and made changes based on SAVE administrative forbearance and a 0% interest period. For many, the message comes after nearly a year of confusion and concern over balances that appeared to grow despite federal guidance that interest had been suspended.
But even as the notices go out, some borrowers say the adjustments haven’t been fully reflected in their accounts.
System errors during the SAVE interest rate pause
Borrowers who participated in the Saving on a Valuable Education (or SAVE) income-driven repayment plan are in administrative forbearance following a court order that halted parts of the program. During the first year of this period, the U.S. Department of Education said interest would not accrue and borrowers would not be required to make payments.
MOHELA, one of the largest federal student loan servicers, previously confirmed that borrowers in the SAVE administrative forbearance had a 0% interest rate.
But even during this interest suspension period, borrowers reported interest accrued on their loans.
Last year, in response to the complaints, MOHELA posted a public clarification stating that interest was not accruing for borrowers in the SAVE administrative forbearance. The administrator described the issue as a “system error” and indicated that affected accounts would be corrected.
Now, borrowers are finally receiving confirmation messages stating that their account balances have been adjusted to reflect the 0% interest period.
The notice explains that an assessment has been conducted and adjustments have been made based on SAVE deferral and 0% interest accrual. It also states that no action is required and directs borrowers to log in to view their updated loan information.
Interest started to rise again from August 1, 2025.
Some borrowers are reporting no solution yet
Despite official communications, borrower reports remain mixed.
On social media and student loan forums, some borrowers say their balances have been corrected and interest removed. Others report that previous interest has not yet been reversed.
The timeline for a complete resolution of the problem has not been publicly detailed.
For borrowers who have added hundreds or even thousands of dollars to their balances, reassurance in the form of a blanket notice has not completely allayed concerns.
Final thoughts
The Ministry of Education has not released detailed data on how many borrowers were affected by the incorrect interest accrual or how long the errors persisted. Without that information it is difficult to estimate the extent of the problem.
It is important to note that servicing errors disproportionately impact lower-income borrowers, who are more likely to participate in income-driven repayment plans like SAVE.
As account adjustments continue to occur, borrowers should keep a close eye on their balances. This is another important reminder of why you need to be vigilant with your financial accounts.
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