The American Federation of Teachers (AFT), one of the largest unions of educators in the country, filed a lawsuit against the U.S. Department of Education on March 19, 2025, over the removal of income-driven repayment (IDR) applications for student loans.
At the end of February 2025, the Department of Education halted processing IDR plans after the 8th Circuit Court of Appeals ruled against the Biden administration’s Saving on Valuable Education (SAVE) plan. This decision has left countless borrowers cut off from affordable repayment options, causing significant financial uncertainty for millions.
According to AFT President Randi Weingarten, "By effectively freezing the nation’s student loan system, the new administration seems intent on making life harder for working people, including for millions of borrowers who have taken on student debt so they can go to college." Weingarten's concerns echo a broader sentiment among many who feel the recent administrative changes are undermining progress in making education more affordable and accessible.
The lawsuit reflects a mounting frustration within the educational community. Educators, particularly those in public service jobs, rely heavily on IDR plans that adjust loan repayments based on income and family size, and many are now facing significantly higher payments or lacking clear pathways to transition into repayment without penalties.
"The Department is working to ensure these programs conform with the 8th Circuit's ruling, and anticipates the revised form allowing borrowers to change repayment plans to be available as soon as next week," stated a spokesperson from the Department of Education. While the department insists that the suspension is temporary, the uncertainty created by halted applications is causing distress among borrowers.
Experts are worried that the halting of IDR applications may not only prevent new borrowers from accessing these crucial repayment plans but could also cause existing participants to fall out of compliance. Jan Miller, President of Miller Student Loan Consulting, warns that “For borrowers in that program, the payments just stopped and they went into kind of a perpetual forbearance until the court finally decides on whether or not SAVE is going to survive.”
Miller added that borrowers who cannot recertify due to the removal of the application are now “stuck between a rock and a hard place,” potentially reverting to higher, standard payments they can no longer afford.
In addition to the financial impacts, the AFT highlights the inequity of imposing such drastic changes without clear communication or support for those affected. “The AFT has fought tirelessly to make college more affordable by limiting student debt for public service workers and countless others—progress that’s now in jeopardy because of this illegal and immoral decision to deny borrowers their rights under the law,” said Weingarten.
The timing of these changes has fueled concerns about the intentions of the new administration, with many speculating that political motivations underlie the broader objective of dismantling previous efforts to support student borrowers. "Student loan borrowers are desperate for help, struggling to keep up with spiking monthly payments in a sinking economy, all while President Trump plays politics with the student loan system," commented Mike Pierce, Executive Director of the Student Borrower Protection Center. These sentiments underscore the urgent need for clarity and resolution in the student loan landscape.
The impact of these shifts is felt not just among borrowers but also among institutions supporting public service workers. With a reported 1.62 trillion dollars outstanding in student loan debt and nearly 43 million federal student loan borrowers, the stakes have never been higher. AFT’s lawsuit seeks to restore access to the statutory programs that are essential for so many.
As the situation continues to develop, borrowers are urged to maintain contact with their loan servicers and remain vigilant for updates regarding the future of income-driven repayment plans. The path ahead may be uncertain, but the determination of groups like the AFT to protect borrowers' rights will play an essential role in shaping the future of student debt policy in the United States.
