Washington, DC – July 15: U.S. Secretary of Education Linda McMahon prepares for live TV interview … More
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The Ministry of Education has suspended student loan forgiveness under the Income-Based Repayment Program (IBR). The IBR program is one of several revenue-driven repayment programs offered to borrowers and the only one that is not subject to any legal challenges or court injunctions.
“Currently, when our system is updated, IBR forgiveness is suspended,” the department announced in its latest guidance on court challenges released earlier this month. “Once these updates are completed, IBR forgiveness will be restored.”
The department’s announcement confirmed a previous statement from former department officials. It confirms that some borrowers have met the student loan forgiveness (but not discharged). This is what we know, what a borrower can do.
Student loan forgiveness under IBR has not been blocked by any court
Like all income-driven repayment plans, IBR uses formulas related to the borrower’s income and family size to determine the borrower’s monthly payment requirements. Payments are then recalculated every 12 months. Borrowers who have not paid off their student loan in full before the end of the repayment period – For borrowers who have taken out their loans by July 1, 2014, those who have obtained the loan on or after that date for 20 years will be entitled to student loan forgiveness.
But IBR is unique because it has not yet been directly challenged by any legal challenges. Last year, a group of Republican-led states filed a lawsuit to stop the rescue plan, a new income repayment created by the Biden administration in 2023. The court's ruling, along with a follow-up ruling issued earlier this year, questioned whether student loan forgiveness was authorized under federal regulations that rule savings. The same regulations are also based on two other revenue-driven plans – ICR and PAYE. But the IBR was created separately by Congress, and the IBR regulations explicitly authorize student loan forgiveness at the end of a 20- or 25-year repayment period. The Court of Appeal acknowledged this in its recent ruling.
As a result, student loan forgiveness is blocked under Save, ICR and PAYE. But student loan forgiveness under Ibrahimovic (IBR) is not. The department confirmed this in its latest guidance on pending litigation released in early July.
“Forgiveness as a characteristic of savings, PAYE and ICR programs because these programs are not formulated by Congress,” the department said. “Generally, Ed can and will handle loan forgiveness for the IBR program formulated separately for Congress.”
However, despite this, the department does not deal with student loan forgiveness under the IBR. The department's announcement confirmed that a former official from the Federal Student Aid Office filed the charges, which suggested in a statement raised by the department's separate legal challenge to mass layoffs that the Trump administration could violate the law by violating debt violations under the IBR.
“My understanding is that as of April or early May 2025, federal student loan borrowers who are eligible for income-based repayment cancellations have not cancelled their loans, a process that has been suspended since July 2024, despite the legal obligation to do so,” the official said. The same official also indicated that it was difficult for the department to update the eligible student loan forgiveness payment count.
The pause of IBR student loan forgiveness is related to a court injunction.
The Ministry of Education has provided only one vague explanation of the suspension of student loan forgiveness under the IBR, suggesting it was suspended “although our system has been updated to accurately calculate the months against the rescue program are not affected by the court injunction.”
The department may have been a federal appeals court ruling mentioned earlier this spring, which expanded the court's injunction to include the basic regulations governing the preservation plan as a whole. Some elements of these regulations also indirectly affect other income-driven repayment plans, including IBR. For example, extensions and tolerance periods that allow certain extensions and tolerance periods under all income-driven plans (ICR, PAYE, SAVE and IBR).
However, in the recent court decision, nothing in the judgment of the legal challenges related to the rescue program requires the ministry to cease forgiveness under student loans under the IBR. No court ordered the department to suspend discharge under the IBR, which was explicitly required under the regulations previously issued by Congress.
The student loan borrower legal group has previously accused the Trump administration of using a recent court order involving a rescue plan to prove policy decisions that harm borrowers.
“Secretary McMahon did not address the damaged student loan system, but chose to flood millions with unnecessary interest and accuse irrelevant court cases of mismanagement with its own mismanagement,” Mike Pierce, executive director of the Center for Student Borrow Protection, said in a statement earlier this month. Tolerated borrowers have no interest in loans since the injunction was first announced last summer.
The possibility of suspending student loan forgiveness in case of other programs interruption
Student loan forgiveness under the IBR was suspended as the federal student loan repayment system was suffering from a lot of turmoil and turmoil. More than 1.5 million in revenue-driven repayment applications are still in a huge backlog as the Ministry of Education has made slow progress after a few months of suspension of processing (department officials also blame the Save Plan Plan ban). Despite such a backlog, earlier this month, the department announced that interest on student loans covered by the preservation plan would be restored in August and encouraged nearly 8 million additional borrowers to apply for changes to different repayment plans, especially for IBR.
“The department urges all borrowers in all savings plans to transition quickly to legally stipulated repayment plans, such as income-based repayment plans,” the department said in the announcement. “Borrowers in savings cannot obtain important loan benefits and cannot make progress in loan release plans authorized by Congress.”
Meanwhile, more changes will be available soon. Earlier this month, President Trump signed what is called the “big and beautiful bill” into law. The legislation changes the IBR program and will ultimately repeal the ICR, PAYE and Save programs while creating a new revenue-driven option in its location, called the “Repayment Assistance Program” or RAP. The IBR will still be used for borrowers who currently repay the loan, allowing student loan forgiveness after 20 or 25 years. However, RAP does not allow loan forgiveness until the borrower pays it 30 years ago.
Currently borrowers at IBR have reached the threshold for student loan forgiveness, but they cannot be released due to the suspension of the Ministry of Education, but have limited options. They can continue to pay under the IBR and hope that once the student loan is released, these overpayments can be refunded (any payments over 240 or 300 monthly payments should be refunded for the monthly payment required for the IBR loan forgiveness). Alternatively, they can contact their loan service provider to demand tolerance to suspend payments. However, interest will continue to remain balanced during the tolerance period, and it is unclear how long the suspension of IBR student loan forgiveness will last.