If you downgrade your account to the Free plan, you will then be within the limits of that plan.
If you have more Habits than the Free plan limit, you will be asked to choose which Habits to keep unlocked and the remaining excess of Habits will be locked.
You can still view and manage locked Habits, but they are archived and can not be used.
Locked Habits can be unlocked, by deleting an unlocked Habit to make space for it, or by upgrading your plan.
You can learn more about locked Habits here.