{"id":12392,"date":"2025-03-26T07:50:46","date_gmt":"2025-03-26T07:50:46","guid":{"rendered":"https:\/\/finderica.com\/?p=12392"},"modified":"2025-03-26T07:50:46","modified_gmt":"2025-03-26T07:50:46","slug":"department-of-education-says-it-will-reopen-student-loan-payment-plans-after-group-takes-legal-action","status":"publish","type":"post","link":"https:\/\/finderica.com\/?p=12392","title":{"rendered":"Department Of Education Says It Will Reopen Student Loan Payment Plans After Group Takes Legal Action"},"content":{"rendered":"\n
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US President Donald Trump in the Cabinet Room of the White House in Washington, DC, on March 25, … More<\/span> 2025. A national labor union is requesting a temporary restraining order to force the Trump administration to reopen affordable student loan repayment plans and loan forgiveness programs. (Photo by Mandel NGAN \/ AFP) (Photo by MANDEL NGAN\/AFP via Getty Images)<\/span><\/p>\n

<\/fbs-accordion>AFP via Getty Images<\/small><\/figcaption><\/figure>\n

A major national labor union asked a federal court this week to force the Trump administration to reopen affordable student loan repayment plans and loan forgiveness programs. And the Department of Education has indicated it will take some initial steps to do so.<\/p>\n

The request, made by the American Federation of Teachers through a motion for a temporary restraining order, follows the union\u2019s filing of a legal challenge last week after the Trump administration effectively shut down access to income-driven repayment programs. The Department of Education is mandated by federal law to offer these repayment programs to student loan borrowers, which allow for affordable payments tied to income and can lead to eventual student loan forgiveness. Enrolling in IDR plans is also typically a requirement for those pursuing Public Service Loan Forgiveness, a separate loan forgiveness program for nonprofit and government workers.<\/p>\n

After the motion was filed, the Trump administration indicated that it would take steps to reopen IDR applications for student loan borrowers as soon as Wednesday. But processing will not immediately resume. Here\u2019s the latest.<\/p>\n

Department Of Education Blocks Repayment Plans And Student Loan Forgiveness<\/h2>\n

The Trump administration issued a \u201cstop work order\u201d to its contracted loan servicers last month, instructing them to halt all processing for income-driven repayment plans. The Department of Education also removed the online and paper IDR application forms, effectively preventing borrowers from applying.<\/p>\n

The order was in response to a new decision issued by the 8th Circuit Court of Appeals in an ongoing legal challenge over the Biden-era SAVE plan, the newest of several income-driven repayment options that was launched under President Joe Biden in 2023. A coalition of states led by Republican attorneys general filed a lawsuit to block the SAVE plan last year. In its new ruling issued in February, the 8th Circuit expanded the existing injunction that prevents the Department of Education from implementing the SAVE plan. While the court suggested that loan forgiveness under two related plans \u2013 ICR and PAYE \u2013 might be improper, the court stopped short of striking down or blocking those two plans. And the court did not order the department to prevent borrowers from accessing the IBR plan or the PSLF program, both of which the court acknowledged were expressly authorized by Congress.<\/p>\n

But the Trump administration\u2019s \u201cstop work order\u201d impacts all four income-driven repayment plans \u2013 not only SAVE, but also the ICR, PAYE, and IBR plans. And in effect, it also partially blocks PSLF for borrowers who must repay their student loans under an IDR plan to qualify. Consequently, borrowers can\u2019t enroll in an IDR plan, change to a different IDR plan, request a recalculation of their payments due to changed financial circumstances, or recertify their income when required to do so, with some borrowers reporting huge increases in their monthly payments as a result.<\/p>\n

Borrowers Ask Court To Issue Temporary Restraining Order To Reopen IDR Plans and Student Loan Forgiveness Pathways<\/h2>\n

In its filing late Monday, the AFT \u2013 represented by the Student Borrower Protection Center \u2013 asked the court to effectively force the Trump administration to reopen at least some of the income-driven repayment plans. The AFT argues that regardless of the 8th Circuit\u2019s order, the Department of Education is legally required to offer these affordable payment plans, which are also a required component for borrowers pursuing student loan forgiveness through PSLF.<\/p>\n

\u201cWithout Congressional authorization, the defendants have inexplicably and irrationally issued a Stop Work order shutting down all<\/em> access to all<\/em> income-driven repayment plans for borrowers seeking to enroll,\u201d reads the motion. \u201cMillions of student loan borrowers are being denied Congressionally mandated student loan repayment and forgiveness programs, simply because the defendants have unlawfully ceased to accept and process enrollment applications.\u201d<\/p>\n

Millions of student loan borrowers \u201care stuck in a devastating limbo\u201d as a result of the Trump administration\u2019s actions, says the AFT. The motion then provides a number of examples, supported by sworn declarations made by student loan borrowers:<\/p>\n