Department of Education Halts Student Loan Forgiveness Under IBR Plan

Washington, D.C. — The U.S. Department of Education has announced a halt to student loan forgiveness under the Income-Based Repayment (IBR) plan. This decision, disclosed on July 21, 2025, follows a notice regarding updates to processing systems amidst ongoing court challenges.

In its statement, the department indicated that “IBR forgiveness is paused while our systems are updated.” Borrowers participating in the IBR plan had anticipated discharges after reaching the required payment period, which is typically 20 to 25 years based on loan origination dates.

IBR is unique among income-driven repayment plans because it is not currently facing legal challenges. However, a federal appeals court last year placed an injunction on other repayment programs, including SAVE, leading to speculation about IBR’s status. The Department confirmed that while IBR was legislated by Congress and should function independently, its forgiveness process has been suspended.

Adam Minsky, a student loan attorney, mentioned the urgency for borrowers, stating, “This pause could severely impact individuals counting on forgiveness at the end of their repayment terms.”

The suspension has left many borrowers frustrated, particularly those who had believed they were nearing discharge. A former official with the Office of Federal Student Aid outlined concerns about the legality of blocking IBR forgiveness, indicating that past political decisions may be influencing current policy.

The Department of Education has provided limited clarity on when the IBR process will resume. Meanwhile, many borrowers are finding it difficult to track changes in their repayment options. The department’s advisory noted that borrowers should consider transitioning to different repayment plans if necessary, further complicating the situation.

Minsky emphasized the importance of remaining proactive, advising borrowers to stay informed about their rights and options. “Waiting for the department to resolve this issue could mean missing critical opportunities for relief,” he added.

As the landscape of federal student loan repayment continues to evolve, existing borrowers in IBR are encouraged to communicate with their loan servicers about their situations. With legislative changes on the horizon, understanding their options will be vital for future financial planning.