The Trump administration halted student loan forgiveness on a widely-used plan during the early summer months. The debt cancellation remains suspended, prompting lawmakers this week to press for its restoration.
During early summer, the U.S. Department of Education announced it would suspend the loan discharge feature of the Income Based Repayment (IBR) plan. This suspension continues today.
Lawmakers, including Sen. Bernie Sanders, I-Vt., addressed Education Secretary Linda McMahon in a Monday letter, calling this development a blow to families who have anticipated—and legally deserve—this assistance.
“While Americans nationwide face rising costs for health care, food, housing, child care and other essential needs, the Trump administration cannot acceptably pursue actions that postpone or block legally required debt relief,” the lawmakers stated.
Higher education expert Mark Kantrowitz reports that 1.97 million federal student loan borrowers currently participate in IBR.
Borrowers need to understand these key details about the plan’s suspended loan cancellation.
How IBR forgiveness typically operates
IBR ranks among the Education Department’s income-driven repayment plans, which people also call IDRs.
Congress established the initial IDR plans during the 1990s to make student loan borrowers’ monthly bills more manageable. These plans traditionally limit people’s monthly payments to a portion of their discretionary income and eliminate any remaining debt after a specific period, usually 20 years or 25 years.
IBR will become one of the few viable repayment options available to millions of borrowers following recent court decisions and Congress’s approval of President Donald Trump’s “big beautiful bill.” This legislation eliminates several income-driven repayment plans.
IBR requires borrowers to pay 10% of their discretionary income monthly—though this percentage increases to 15% for specific borrowers carrying older loans.
Debt forgiveness occurs after 20 years or 25 years, depending on your loan origination date. (Older loans follow the extended timeline.)
Why IBR loan forgiveness remains suspended
The U.S. Department of Education informed CNBC that it suspended IBR loan forgiveness while addressing recent court actions concerning the Biden administration’s SAVE (Saving on a Valuable Education) plan.
The department explained that the 8th U.S. Circuit Court of Appeals decision in February, which halted the SAVE plan, created additional consequences for student loan repayment. The SAVE rule previously allowed certain payment postponement periods to count toward borrowers’ forgiveness timeline. With SAVE blocked, borrowers lose credit during those forbearances.
Ellen Keast, deputy press secretary at the Education Department, stated in late July that IBR discharges would restart “as soon as the Department is able to establish the correct payment count.”
The department has not responded to recent inquiries about the continuing pause.
“The federal government operates slowly, but I expected some advancement by this point,” Kantrowitz observed.
What borrowers can do during this period
The IBR discharge suspension shouldn’t affect student loan borrowers who remain years away from debt forgiveness, experts noted.
Since IBR launched in 2009, many borrowers cannot qualify for forgiveness until 2034 at the earliest, Kantrowitz explained. The current debt erasure delay would primarily impact borrowers who previously enrolled in another IDR plan—Income-Contingent Repayment (ICR)—and subsequently transferred to IBR.
If you’re seeking debt forgiveness through IBR, your payments under this plan (or another income-driven repayment plan) continue to move you toward debt cancellation, provided you maintain IBR enrollment when you qualify for that relief.
Kantrowitz advises borrowers who anticipated near-term debt forgiveness to keep making their payments. You want to avoid late payment flags, and the system should refund any overpayments you make, he noted.
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