The U.S. Department of Education has temporarily paused student loan forgiveness under the Income-Based Repayment (IBR) plan, even though it is currently the only income-driven repayment program unaffected by lawsuits or court blocks.
In updated guidance released earlier this month, the department stated that, “IBR forgiveness is paused while our systems are updated.” According to officials. Loan discharges will resume once those system adjustments are complete.
This update aligns with earlier reports from former Department of Education officials and validates concerns among borrowers who had fulfilled the forgiveness requirements under IBR but didn’t receive a loan discharge.
IBR Forgiveness Isn’t Legally Blocked
IBR, like other income-driven repayment options, calculates monthly payments based on a borrower’s income and household size. After 20 or 25 years of consistent payments depending on when the loans were first issued. Borrowers become eligible for student loan forgiveness.
What sets IBR apart from other plans is that it was established by Congress and contains clear statutory language supporting forgiveness after the repayment period. Unlike the SAVE, PAYE, and ICR plans — all of which rely on the same statute now facing legal scrutiny. IBR is not included in any current legal disputes. This distinction was even acknowledged by a federal appeals court in recent rulings concerning the SAVE plan.
Despite this legal clarity, the Department of Education has chosen to pause IBR-related discharges, validating claims made by a former Federal Student Aid official. Who alleged in court that the agency may be unlawfully withholding relief.
Department Links Pause to SAVE-Related Injunction
While IBR isn’t directly impacted by the court order against the SAVE plan, the department cited the need to update systems to ensure months not affected by the SAVE injunction are accurately counted. This may be related to a broader court decision that expanded the SAVE plan injunction to its full underlying regulation. Some of which impacts how deferments and forbearances are credited across all IDR plans, including IBR.
However, nothing in the court’s ruling requires the department to halt IBR forgiveness. In fact. Discharging loans under IBR remains a statutory obligation. Critics suggest the department is using SAVE-related litigation as an excuse to delay borrower relief.
Critics Accuse Department of Mismanagement
Advocacy groups and former education officials have accused the Department of Education of using the court’s SAVE-related ruling as political cover to make decisions that ultimately harm borrowers.
“Rather than fixing what’s broken, Secretary McMahon is allowing interest to pile up while blaming unrelated court battles,” said Mike Pierce, executive director of the Student Borrower Protection Center. His comments came in response to the department’s decision to restart interest accrual on loans covered under SAVE forbearance. Loans that have been interest-free since the injunction took effect last summer.
IBR Pause Adds to Broader Repayment Chaos
This freeze on IBR forgiveness comes at a time of widespread disruption across the federal student loan system. Over 1.5 million applications for income-driven repayment are still pending due to a massive backlog caused by the department’s earlier decision to pause processing — again. Citing the SAVE injunction.
Ironically, the Department is now encouraging borrowers on SAVE to switch to IBR, describing it as a “legally compliant” plan. “Borrowers on SAVE won’t receive key loan benefits or progress toward forgiveness. We urge them to move to IBR,” said the department in a recent announcement.
RAP to Replace IDR Plans, IBR to Remain
Further complicating the picture, President Trump recently signed the “Big, Beautiful Bill” into law. This legislation will eventually eliminate SAVE, PAYE, and ICR plans. Replacing them with a new repayment model known as the Repayment Assistance Plan (RAP). While IBR will remain available for existing borrowers, RAP will require borrowers to wait 30 years before becoming eligible for forgiveness.
What Borrowers Can Do During the IBR Forgiveness Pause
Borrowers who have already hit their forgiveness milestone under IBR but haven’t seen a discharge have limited paths forward. They can either:
Continue making IBR payments in hopes that excess payments beyond the required 20 or 25 years will be refunded once forgiveness resumes; or
Request a forbearance to pause payments temporarily. Though this could lead to interest accrual and uncertainty over when forgiveness will restart.
For now, there’s no clear timeline for when the Department of Education will lift the pause, leaving many long-term borrowers in limbo.