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Student loan forgiveness options have dwindled considerably during President Donald Trump's second administration, but the Department of Education says forgiveness through Income-Based Repayment isn't going away. However, it is on pause.
The Federal Student Aid website says IBR forgiveness is on hold while the Education Department retools its system to recalculate eligible payments. "IBR forgiveness will resume once those updates are completed," said an FAQ section updated July 9.
The key question is how the Education Department counts payments made under the Saving on a Valuable Education repayment plan, which was struck down by the courts earlier this year.
Borrowers on the IBR can have the payments they made on other income-driven repayment plans (including SAVE, PAYE and ICR) count toward their IBR forgiveness. But one of SAVE's features allowed borrowers to count months in certain types of forbearance when they didn't make payments, according to student loan expert Mark Kantrowitz.
"The decision of the 8th Circuit Court of Appeals blocks these additional deferments and forbearances from counting toward forgiveness," he said in an email. "So the US Department of Education will need to make changes to the qualifying payment counts."
IBR is an income-driven student loan repayment plan that adjusts monthly payments based on borrowers' income. Eligible student loan borrowers can receive forgiveness after 20 or 25 years' worth of payments, depending on when they took out their loan. It's currently the only repayment plan available that offers a path to forgiveness to existing borrowers.
We'll explain what could happen with IBR, and what you should do if you're waiting for student loan forgiveness.
Read more: SAVE Student Loan Borrowers: You Don't Have to Move to IBR by Aug. 1, but You May Want to: Here's How to Decide
Is student loan forgiveness going away?
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