Trump Cancels Student Loan Debt for Millions

In a lawsuit filed in March, the AFT – which has about 1.8 million union members – accused Trump officials of blocking federal student loan holders from accessing programs that were in effect when they first borrowed.

Earlier in the year, the White House paused student loan forgiveness under some income-driven repayment plans. These programs calculate a borrower’s monthly payment based on their salary, and typically cancel any remaining debt after 20 or 25 years.

Trump’s Education Department – led by Linda McMahon – argued it could block these programs due to a court order pausing the Biden-era Saving on a Valuable Education plan, or SAVE, another income-driven repayment program.

The temporary blocks left borrowers with just one repayment plan option resulting in loan cancellation, known as the Income-Based Repayment plan, or IBR.

As Trump’s signature tax and spending legislation took shape over the summer, consumer advocates warned about the potential damage to borrowers.

Limited repayment options – including the end of SAVE – could spike monthly student loan payments for a typical borrower by hundreds of dollars, according to an analysis from research nonprofit Student Borrower Protection Center.