In a move that has left millions of student loan borrowers in limbo, the Trump administration has removed key repayment applications from the US Department of Education’s website. The applications for income-driven repayment (IDR) plans and loan consolidation, which are critical tools for many borrowers seeking lower monthly payments, are no longer accessible. This action has sparked concerns over how long the disruption will last and what it means for borrowers who rely on these programs to manage their student loan debt.
The removal of these applications follows a ruling from the 8th Circuit Court of Appeals that blocked the Biden administration’s new IDR plan, known as SAVE (Saving on a Valuable Education). As a result, the Education Department is now reviewing and revising the applications to comply with the court’s decision. While experts expect the disruption to be temporary, there are questions about whether this situation could evolve into a more permanent roadblock for borrowers.
The impact on borrowers and repayment options
The removal of IDR and loan consolidation applications leaves borrowers with fewer options, particularly those who rely on income-driven plans to make their student loan payments more affordable. More than 12 million people were enrolled in IDR plans as of September 2024, and many use these programs to ensure that their monthly payments are capped at a percentage of their discretionary income. These plans also offer a pathway to loan forgiveness after 20 to 25 years of qualifying payments.
As reported by CNBC, higher education expert Mark Kantrowitz explained that the disruption could last “a few months” while the Education Department works to make necessary adjustments. He added, “I expect it will be temporary, lasting a few months while they make changes.” However, for borrowers, this temporary disruption still represents a significant challenge. Those due to recertify their IDR plans or consolidate their loans now have no immediate access to the necessary tools.
A strain on borrowers with financial difficulties
For borrowers already struggling with their loans, the timing of the disruption couldn’t be worse. Betsy Mayotte, president of The Institute of Student Loan Advisors, highlighted that “borrowers who are due to recertify their IDR plans will also have to sit tight for the time being.” This means that some borrowers may face higher payments if they cannot update their income information in a timely manner.
For borrowers who can’t afford their loans and were planning to switch to an IDR plan, this disruption leaves them without affordable options for the time being. While they can still submit a paper loan consolidation application, it is a more cumbersome process that could delay any relief they might receive. In the meantime, options like deferments and forbearances may become the go-to solution, but these alternatives often come with their own drawbacks, including the accrual of interest, as noted by CNBC.
Long-term uncertainty for public service borrowers and graduates
The disruption will be felt most acutely by borrowers in the Public Service Loan Forgiveness (PSLF) program, as well as recent graduates. The PSLF program, which offers loan forgiveness for borrowers who work in qualifying public service jobs, heavily relies on IDR plans. The inability to access repayment applications may prevent these borrowers from enrolling in IDR plans or recertifying their information, which could ultimately delay their progress toward loan forgiveness.
Moreover, recent graduates typically receive a six-month grace period before their first student loan bill is due. As explained by Kantrowitz, these borrowers “won’t need to sign up for a repayment plan until November or December,” which may allow time for the applications to be restored. However, those who are nearing the end of their grace period and need to transition to an IDR plan or consolidation are facing a significant barrier to doing so.
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