Teachers Union Sues Education Department Over Student Loan Repayment Plan Shutdown

The American Federation of Teachers alleges the Department's actions violate federal law and harm borrowers relying on income-driven repayment plans for loan affordability and forgiveness.

The American Federation of Teachers (AFT) has filed a federal lawsuit against the U.S. Department of Education for halting income-driven repayment (IDR) plans, which provide affordable loan payments tied to income.
The Department removed IDR applications following a February 18 court ruling blocking the Biden administration's SAVE Plan, citing the need to comply with the decision.
AFT argues that the Department's interpretation of the ruling is overly broad, unnecessarily halting unrelated IDR plans and disproportionately impacting public service workers who rely on these plans for Public Service Loan Forgiveness (PSLF).
The lawsuit seeks a court order to restore access to IDR plans and PSLF, claiming the Department's actions violate federal law and harm millions of borrowers, including pushing some into default.
The Department has stated that the removal of IDR applications is temporary, with revised forms expected soon, but no specific timeline has been provided.