The Department of Education has reinitiated the application process for Income-Driven Repayment (IDR) plans and online loan consolidation, as disclosed in a hearing by Department of Justice attorneys. The reopening comes following a legal strike by the American Federation of Teachers due to the last month's closure of IDR plans. A separate court case involving the Saving for a Valuable Education (SAVE) plan questioned some aspects of other IDR plans.
The Department of Education confirmed on Wednesday that the forms have been updated in accordance with the court order and are now available to the public. Government officials said the reopening occurred due to a federal appeals court decision which disagreed with the Biden Administration's move to shift student loan debt to taxpayers. The Trump administration, in response, amicably adjusted the income-driven repayment plan application to fit the court ruling.
The previous closing of the service hindered borrowers from choosing a more economical repayment scheme, and in some cases, bared them from recertifying their IDR plans. The resultant effect was higher monthly payments. Notably, some public service workers also found themselves unable to accrue credit towards Public Service Loan Forgiveness (PSLF).
Students now have the liberty to apply for Income-Based Repayment (IBR), Pay As You Earn (PAYE), and Income-Contingent Repayment (ICR) online, in addition to loan consolidation. However, plans like Revised Pay As You Earn (REPAYE) and Saving for a Valuable Education (SAVE) remain inaccessible.
The Student Borrower Protection Center (SBPC), a representative of the AFT in the legal battle, expressed that although application services were resumed, the Department of Education might not begin immediate processing of requests.