The Department of Education plans to reopen applications for a popular set of student loan repayment programs as soon as Wednesday after blocking access to them for several weeks, according to two sources familiar with the administration’s plans.
The change will once again allow borrowers to sign up for income-driven repayment options that cap their monthly payments at a share of their earnings. The Trump administration abruptly took down the online forms for those plans last month in response to a federal appeals court decision, leaving many former students baffled about how to manage their loans.
When the portal reopens, borrowers will be able to enroll in one of three plans according to the sources: Income-Based Repayment, Pay as You Earn, or Income-Contingent Repayment. The Biden administration’s SAVE plan and REPAYE, both of which were involved in last month’s court ruling, will not be available. Neither will offer a feature that automatically selects a plan based on the lowest monthly payment.
Student loan servicers have been told to resume processing income-driven repayment applications in about two weeks, the sources said. They had been put on pause while applications were shuttered.
Read more: How to apply for IDR forgiveness
The Department of Education closed off access to income-driven repayment options in February after the US Court of Appeals for the Eighth Circuit upheld an injunction stopping the government from implementing SAVE, which lowered monthly payments on undergraduate loans to 5% of discretionary income and shortened the path to forgiveness compared to previous repayment options. In doing so, the court also ruled that parts of REPAYE, which capped payments at no more than 10% of earnings, were likely illegal as well.
Student loan advocates criticized the decision to cut off access to programs like Income-Based Repayment, which was not part of the litigation, as an overreaction. The move may have been necessary, however, because borrowers apply to all of the income-driven plans using the same online form.
Many students already enrolled in income-driven plans were worried that they would not be able to submit their annual paperwork recertifying their incomes, which could cause their monthly payments to balloon. But last week, student loan servicers announced that the deadlines for those forms had been pushed back until February 2026.
According to one of the sources who spoke with Yahoo Finance, the staffers responsible for turning the IDR application back on were originally laid off as part of the Department of Education’s massive reduction in force this month, aimed at cutting the agency’s headcount in half. But they were brought back a week later after officials realized that nobody else understood how the technology behind the applications worked.
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