Students walk through the University of Texas at Austin on February 22, 2024 in Austin, Texas.
Brandon Bell | Getty Images
The Trump administration has taken down the applications for popular student loan repayments plans from the U.S. Department of Education‘s website, leaving millions of borrowers with fewer options for now.
Borrowers are unable to access the applications for income-driven repayment plans, as well as the online application to consolidate their loans.
Both applications are critical for borrowers pursuing lower monthly payments and loan forgiveness through an IDR plan, as well as the related Public Service Loan Forgiveness program.
The disruption is due to a recent decision by the 8th Circuit Court of Appeals that blocked the Biden administration’s new IDR plan, known as SAVE, or Saving on a Valuable Education, as well as the loan forgiveness component under other IDR plans.
Congress created IDR plans in the 1990s to make borrowers’ bills more affordable. The plans cap borrower’s monthly payments at a share of their discretionary income, and cancel any remaining debt after a certain period, typically 20 years or 25 years.
More than 12 million people were enrolled in the plans as of September 2024, according to higher education expert Mark Kantrowitz.
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Here’s what to know about the changes.
Applications could be down for ‘a few months’
The IDR plan applications shouldn’t be down for too long, Kantrowitz said.
“I expect it will be temporary, lasting a few months while they make changes,” he said.
The Education Department is likely tweaking the applications to make sure all their plans comply with the new court order, as well as removing the SAVE plan all together.
The Education Department did not immediately respond to CNBC’s request for comment.
Betsy Mayotte, president of The Institute of Student Loan Advisors, a nonprofit, also didn’t expect a long wait time before the applications return.
“I get the sense the ED is working hard to get the changes made,” Mayotte said.
Impacts of the plans going dark
Unfortunately, there’s nothing federal student loan borrowers who want to sign up for an IDR plan or switch between the plans can do right now, Kantrowitz said.
Borrowers who are due to recertify their IDR plans will also have to sit tight for the time being, Mayotte said. (Those enrolled in IDR plans typically have to submit their income information annually.)
While the legal challenges against SAVE were playing out, the Biden administration put enrollees into an interest-free forbearance. That payment pause is likely to end soon, experts said. By then, borrowers should be able to access other IDR plans, though.
Those who graduate in the spring are typically entitled to a six-month grace period before their first bill is due, Kantrowitz pointed out.
As a result, they won’t need to sign up for a repayment plan until Novemember or December. The plans should be available again by then.
Options if you can’t afford your student loan bill
The disruption to IDR plans will be especially difficult for borrowers who can’t afford their current student loan bill and now can’t access a more affordable option, Mayotte said.
These borrowers can call their loan servicer and explain their situation.
You should first see if you qualify for a deferment, experts say. That’s because your loans may not accrue interest under that option, whereas they almost always do in a forbearance.
