Student Loan Updates for March 2026

Happy March, everyone. We hope you’re starting to thaw out after a cold winter. It is a fairly quiet month in the student loan world — no major updates, no headlines about mass loan forgiveness, no refund checks going out, no major rulings in the SAVE lawsuit, and certainly no new rules from the One Big Beautiful Bill Act (OB3). Nope, none of that is happening. But feel free to keep reading anyway!

Major Updates in The SAVE Lawsuit

In a stunning turn of events, the Federal judge presiding over the long-running SAVE lawsuit decided to push aside the settlement agreement we reported on in December. Instead, the judge decided to dismiss the case entirely!

The court said the case was moot, reasoning that there was no longer an active dispute between the parties. In other words, if no one is fighting anymore, there’s nothing for the court to decide.

This has set off a chain of events dragging three other courts into the mix. We’ve completely redrafted the new SAVE article that we just sent out to many of you last week. Click here to get all the details.

New Refund Checks Could Be Headed to Some Federal Student Loan Borrowers

Some federal student loan borrowers may soon receive unexpected refund checks. According to a recent Forbes report, these payments stem from account corrections tied to years of policy changes and repayment plan adjustments.

In short, some borrowers paid more than they ultimately owed due to shifting rules around the COVID-era payment pause, income-driven repayment (IDR) plans, and Public Service Loan Forgiveness. As the Department of Education reviews and updates repayment counts, certain accounts are showing credit balances which can trigger a refund. These refunds are not part of a new forgiveness program. They reflect corrections to loan records and the return of payments that were not required under updated rules. The amount varies widely depending on payment history, with some borrowers receiving modest sums and others seeing checks for several thousand dollars.

Borrowers should monitor communications from their loan servicer and check their accounts at StudentAid.gov. Refunds are typically processed automatically once a credit balance is confirmed. If you have questions about your account, contact your servicer directly to understand whether a refund may apply to you.

Borrower Defense Settlement Back In The News

In a twist no one saw coming; the Department of Education’s staffing challenges may end up benefiting a whole lot of borrowers. “Post-class” borrowers from the 2022 Borrower Defense case were unlikely to see any loan discharges. Unlike those who were part of the original class and received automatic discharges, this group was supposed to have their claims individually reviewed by DOE and receive a decision as to whether any relief was warranted. Well…take a guess what happens when over 200k claims need to be reviewed, but you lay off half of your education department. They don’t get reviewed.

The Department missed its deadline. The administration asked the court twice for an 18-month extension. The judge denied both requests. Under the terms of the settlement, if the Department failed to review the post-class claims by the deadline, those loans would be discharged automatically.

Roughly 200,000 post-class borrowers will soon receive loan discharges — even though their claims were never individually reviewed for legitimacy. You just can’t make this stuff up! Read the full story here.

Important Updates for “Legacy Borrowers”

First off — what’s a “Legacy Borrower”? Simple: borrowers who take/took out no federal loans on or after July 1, 2026. That status gives you access to “legacy” repayment plans like IBR and PAYE while “new borrowers” are stuck with RAP and the new standard plan.

Last month, we shared that the proposed rules under the One Big Beautiful Bill Act (aka OB3) were finally released. While they answered several big-picture questions, a few critical details were still unclear. I just returned from a financial aid conference where some well-connected DC insiders helped clarify a couple of those points.

First: Any consolidation loan that disburses after June 30, 2026 will cause you to lose legacy status. We were hoping the application date would be what mattered. It appears that’s not the case. The disbursement date controls.

This is especially important for 2026 graduates, who often submit consolidation applications in May or June. While consolidations typically process in 2–4 weeks, that timeline is never guaranteed. If the loan disburses after June 30, you could unintentionally forfeit access to legacy plans, such as IBR. 2026 grads need to proceed carefully.

Second: For legacy borrowers who want to enroll in IBR before it’s phased out (assuming you don’t get caught in the above trap), you must be in the program by June 30, 2028. Miss that deadline and…again…RAP becomes your only IDR option going forward. That said, the proposed rules suggest that legacy borrowers could take advantage of the generous interest subsidies through RAP before that date, if applicable.

Also worth noting, the final rules for the OB3 may not get published until June! Again, we’re reading the “proposed” rules. A comment period is currently underway, and changes could happen. Changes as late as May or June could cause havoc for borrowers, schools, and servicers. Let’s hope we get final guidance a bit sooner!

In Closing

Like I said at the beginning…it’s a slow news month. But if any of these trivial topics might be causing you a small amount of stress, just remember – our team is always here to support you.

P.S. – One of our lending partners just lowered their fixed rates to 3.26%, but only if you’re using our SLP discount link. If you ever get tired of the government making your student loan repayment options difficult, refinancing can serve as a strategic off ramp. And as always, we handle the process for free!