Education Department Halts Student Loan Forgiveness Processing for Three Months

A court ruling against the SAVE plan prompts the Education Department to suspend income-driven repayment applications, leaving millions of borrowers uncertain about their repayment options.

The Education Department has instructed loan servicers to stop accepting and processing all income-driven repayment (IDR) and loan consolidation applications for three months, with the possibility of extension or early termination.
Borrowers currently enrolled in IDR plans cannot recertify during this period, and only the standard, graduated, and extended repayment plans remain available.
The suspension follows a federal court ruling against the SAVE plan, which was designed to lower monthly payments and provide faster loan forgiveness, leaving millions of borrowers in limbo.
Borrowers on the SAVE plan, including those with $0 monthly payments based on income, face significant financial strain if forced into higher repayment plans.
Advocates are urging the Education Department to reopen at least one IDR plan, arguing that the court ruling does not mandate blocking all affordable repayment options.