The American Federation of Teachers (AFT) has filed a lawsuit against the U.S. Department of Education over the decision to block access to affordable income-driven repayment (IDR) plans for millions of student loan borrowers. The lawsuit, filed in Washington D.C. district court on Tuesday, challenges the Trump administration’s move to remove the application process for these plans.
Impact on Working Families
Randi Weingarten, AFT President, expressed concerns about the administration’s actions, stating, “By effectively freezing the nation’s student loan system, the new administration seems intent on making life harder for working people, including for millions of borrowers who have taken on student debt so they can go to college.”
IDR plans were first created by Congress in the 1990s to ease the burden of student debt by capping monthly payments to a percentage of borrowers’ discretionary income. Additionally, any remaining debt is forgiven after a set period, typically 20 to 25 years. According to higher education expert Mark Kantrowitz, over 12 million individuals were enrolled in IDR plans as of September 2024.
The Department of Education cited a recent court decision as the cause for the suspension of IDR plan applications. The ruling, handed down by an appeals court in February, blocked the Biden administration’s newly proposed IDR plan, known as SAVE (Saving on a Valuable Education). In response, a spokesperson for the Department noted that they were working to ensure compliance with the 8th Circuit Court’s ruling and expected the revised application form for changing repayment plans to be available soon.
Legal Pushback Against Broad Suspension
However, AFT argues that the Education Department’s interpretation of the court ruling was overly broad, causing the shutdown of applications for all IDR plans, not just the new SAVE program. This leaves borrowers currently enrolled in SAVE unable to transition to other IDR plans, and new applicants cannot seek reduced payments through available options. Furthermore, IDR plans are crucial for borrowers aiming for loan forgiveness.
Mike Pierce, executive director of the Student Borrower Protection Center, emphasized the distress facing borrowers, saying, “Student loan borrowers are desperate for help, struggling to keep up with spiking monthly payments in a sinking economy, all while President Trump plays politics with the student loan system.”
Author’s Opinion
It is becoming increasingly clear that the uncertainty and shifting policies surrounding student loan repayment are only exacerbating the struggles for borrowers. When people who are trying to improve their future by obtaining higher education are left hanging with inconsistent rules and policy changes, it sends the wrong message. The ongoing legal battles and policy revisions should focus on fairness and predictability, allowing borrowers to focus on their futures without the added stress of constantly changing repayment structures.
