Department of Education Reopens Income-Driven Repayment Plan Applications

The Department of Education reopened applications for Income-Driven Repayment (IDR) plans and online loan consolidation.

During a hearing Tuesday, the Department of Justice attorneys indicated that the education agency would reopen IDR applications. The American Federation of Teachers is suing over last month’s closure of IDR applications. A decision by a judge in a separate case heard by the 8th Circuit Court of Appeals involving the Saving for a Valuable Education (SAVE) plan questioned parts of other IDR plans.

On Wednesday, the Department of Education said the forms had been revised to comply with the appeals court’s order and are once again available.

“A federal appeals court struck down another one of the Biden Administration’s illegal efforts to transfer student loan debt to taxpayers,” said James Bergeron, acting Under Secretary of the Department of Education, in a statement. “In response, the Trump Administration substantially revised the income-driven repayment plan application to conform with the ruling.”

The closure prevented borrowers from entering a more affordable repayment plan, and some were unable to recertify their IDR plans. The lawsuit states that this resulted in higher monthly payments, and some public service workers were unable to earn credit toward Public Service Loan Forgiveness (PSLF).

Borrowers can now apply online for Income-Based Repayment (IBR), Pay As You Earn (PAYE), Income-Contingent Repayment (ICR), and loan consolidation. The Revised Pay As You Earn (REPAYE) and Saving for a Valuable Education (SAVE) are still unavailable.

The Student Borrower Protection Center (SBPC), one of the organizations representing the AFT in the lawsuit, said that although applications will open, the Department of Education will likely not begin processing applications immediately.