Got Student Loans? Here’s What to Know During These Department of Education Cuts

Update, 11 a.m. March 31: As of March 26, the income-driven repayment plans Pay As You Earn (PAYE) and Income-Contingent Repayment (ICR) are now open to enrollment again. Borrowers can also now apply for loan consolidation online.

On March 11, President Donald Trump’s administration announced plans to cut half of the Department of Education’s workforce starting Friday, fulfilling parts of a long-held conservative mission to weaken the agency. More than 1,300 positions will be eliminated, according to the announcement, and around 600 more employees accepted voluntary resignations or retired over the last two months.

The Department of Education administers student loans and aid programs and many of the layoffs occurred within the Federal Student Aid department. One in four adults under 40 in the United States has student loan debt, and Americans owed about $1.6 trillion in student loans as of June 2024, according to a Pew Research Center analysis.

In a statement, the Department of Education said it would “continue to deliver on all statutory programs that fall under the agency’s purview,” including student loans and Pell Grants.

• • Jump straight to: I have student loans. Should I be backing up my payment records?

Beth Maglione, the interim president and CEO of the National Association of Student Financial Aid Administrators, called the idea that services will not be interrupted “at best, naive and, at worst, deliberately misleading.”

According to Inside Higher Ed, many of the dismissed employees within the Federal Student Aid department assisted with the technical administration of student loans, including working on functionalities for the Free Application for Federal Student Aid (FAFSA), which was hit hard during its troubled revamp last year. The planned cuts also include staffers who answered FAFSA questions for students and parents and who handle disputes between borrowers and loan services.

“One of the big themes that I noticed is that a lot of the helpers are gone,” said Betsy Mayotte, the founder of the nonprofit Institute of Student Loan Advisors. “Borrowers need more help, not less.”

California quickly joined other states in a lawsuit to fight the cuts, but the Department of Education’s precarious situation is now coupled with ongoing uncertainty around repayment plans. Eight million student loan borrowers were enrolled in former President Joe Biden’s SAVE income-driven repayment plan in hopes of cheaper payments and a shorter loan repayment timeline, but the Eighth Circuit Court of Appeals blocked the plan in February in a decision that also prevented borrowers from enrolling in other income-driven repayment plans for their student loans.

All this has left the 42.7 million Americans who have federal loan debt with little clarity on what will happen to their current debt, said Adam S. Minsky, a lawyer specializing in student loans.

“It’s very difficult right now for borrowers to be able to make informed decisions because there is so much uncertainty and volatility right now,” Minsky said. “We don’t know what the landscape is going to look like in a month or six months or a year.”

So, if you have student loans, what do we know right now? KQED spoke to Minsky and Mayotte about what borrowers should know in the immediate aftermath of the Department of Education cuts and what practical actions they can take right now amid so much confusion. You can also regularly check studentaid.gov for the latest official updates.

At a glance: What different types of student loan borrowers should know 

If you’re a borrower, make sure you know what kind of income-driven repayment plan you’re enrolled in for your student loan debt:

• Pay As You Earn (PAYE) Repayment Plan
• New Income-Based Repayment (IBR) Plan
• Old Income-Based Repayment (IBR) Plan
• Income-Contingent Repayment (ICR) Plan
• Saving on a Valuable Education (SAVE) Plan

Unless you are on SAVE, you should be making your payments, Mayotte said.

The Trump administration’s cuts to the Department of Education and SAVE court orders mean that borrowers could be at the mercy of potential changes to their income-driven payment plans, said Minsky. Some borrowers may see their monthly payments increase. Other borrowers may no longer qualify for certain types of forgiveness programs.

“It is possible that borrowers could see some very tangible, possibly negative changes as a result of what’s going on right now with student loans,” Minsky said.

If you are currently unable to afford your payments, Mayotte said you can ask your servicer for a “forbearance” — which is the chance to pause payments temporarily. Keep in mind that this is a move you can only make a limited number of times, and interest does accrue during this period.

If you are on the SAVE plan, look for alternatives

The SAVE program was meant to serve as Biden’s victory lap in fulfilling a campaign promise. However, the courts have now more or less sunk SAVE, said Mayotte, forcing millions of Americans into forbearance.

People enrolled in SAVE do not need to make payments and interest does not apply. They will need to wait to see when the other income-driven payment programs open enrollment in order to switch to those plans. However, in most cases, time in this forbearance does not count toward other payment programs.

It “might be a good idea” for borrowers to “start exploring what your alternative repayment plan options are going to look like” so they are not unprepared for when the change comes, Minsky added.

If you are on ICR or PAYE, you may run into restrictions

Some of the other repayment plans like Pay As You Earn (PAYE) and Income Contingent Repayment (ICR) also got caught up in SAVE’s legal challenges — and after the February court ruling, the Department of Education is now barring people from new enrollment or recertifying their income. You can still enroll in the non-income-driven plans for the chance of having a lower monthly payment.

If you are already enrolled in these plans, you can and should still make your payments.

If you cannot recertify your income, you will not be kicked off your PAYE or ICR plan. There is a chance that the Department of Education will extend the deadline for recertifying, but that has not been announced yet, said Mayotte. According to the federal student aid website, your required monthly payment amount “will be the amount you would pay under a Standard Repayment Plan with a 10-year repayment period, based on the loan amount you owed when you initially entered the income-driven repayment plan.”

If you completed your required number of months under PAYE, you would be placed in a forbearance.

But in general, it is unknown when recertification of income or new enrollment for these plans may resume.

“We’re hoping that whatever this pause is, it’s temporary and that processing will resume soon,” Minsky said. “It’s still fairly new, so we’ll have to see what happens.”

Mayotte predicts that these repayment programs — except for SAVE — “are going to come back.”

Acknowledging that it “can be really difficult” not to panic, Mayotte urged borrowers not to “make any rash decisions based on something that happened today.”

“I’ve never seen the chaos that we’re experiencing today, but I do think that in the end, a lot of this is going to shake out,” she said. “Just sort of take a deep breath, keep yourself educated [on the latest updates] and wait and see.”

According to the Department of Education, “payments on PAYE, SAVE, and ICR are counted toward IBR Plan forgiveness if the borrower enrolls in IBR.”

You can’t submit online applications for consolidation

Consolidation allows you to combine your different loan types into one large single loan.

However, because of the SAVE court block, you are currently unable to apply for this online. You can file a paper application and mail it to loan servicer Aidvantage.

Download copies of your Public Service Loan Forgiveness progress 

More than two million Americans qualify for the Public Service Loan Forgiveness (PSLF) program, which wipes out your debt when you work for a nonprofit and make 120 monthly payments while at a nonprofit.

Minsky advised that if you are in the program, take screenshots of your progress by heading to “Track Your PSLF Progress” on your online dashboard and certify your employment if you haven’t in a while. Borrowers on the PSLF program need to enroll their employer on the website so their payments can be counted successfully.

Trump issued an executive order to limit the program to exclude employees working for certain nonprofits, like organizations the order deems to be “supporting terrorism” and offering “so-called transgender sanctuary.” However, those changes are not happening any time soon, according to Federal Student Aid, which is part of the Department of Education. “The PSLF Program is not changing today, and borrowers do not need to take any action,” the agency wrote on social media.

“Several advocacy groups for student loan borrowers have said that the proposed changes would likely be illegal or unconstitutional,” Minsky said. “And so depending on when they get implemented and what the final regulations look like, there might be legal challenges.

“Programs that were created by Congress typically would require Congress to fundamentally change or repeal.”

How can student loan borrowers back up their records?

“Anytime you have a debt, it never hurts to keep good records on that debt,” said Mayotte.

In an article for Forbes, Minsky detailed several ways borrowers should save their loan information in case of any changes the federal government may make, like taking down agency websites. (Several digital archivist groups, like the Wayback Machine, have already been attempting to save records of these shuttered websites, and Minsky suggested you may consider taking screenshots of the details of your plan on the Department of Education website.)

Minsky advises you to consider:

Taking screenshots of your student loan dashboard on studentaid.org

Include any progress you may have made on income-driven repayment plans. 

Downloading your federal student loan data 

Log into your studentaid.org account on your computer, which may make this process easier than navigating on mobile. Click on “View Details” on your dash and then select “My Aid.” There should be a “Download My Aid Data” in the top right corner. This will result in a raw file downloaded to your computer. 

Downloading your student loan record from your loan servicers

Use studentaid.org to find out if your loan servicer is either MOHELA, EdFinancial, Aidvantage or Nelnet. You can then check your account directly with these services and download your loan data to complement the data you downloaded straight from studentaid.org.

How to add extra security to your student aid account

In late February, a judge blocked efforts by billionaire Elon Musk and staffers at the unofficial Department of Government Efficiency (DOGE) to gain access to student loan data. This came after labor unions like the American Federation of Teachers sued agencies for allowing Musk to have access to the data in the first place, stating concerns about the privacy of millions of borrowers.

While Minsky noted there has been “no clear indication” of widespread danger to borrower accounts, he wrote that it could be helpful for Americans to update the passwords on their studentaid.gov account and enable two-factor authentication (also known as 2FA), which will send a code to your phone or email that you would then use to access your dashboard.

How to recognize misinformation about student loans right now 

Mayotte stressed that “wrong” and “damaging” rumors about student loans have spread far and wide on TikTok and Facebook. “So be wary where you’re getting your student loan information,” she said.

Mayotte said posts she’s already debunked from other borrowers include:

False: Current events may mean your loans could be wiped out

Online, some hopeful borrowers posted — perhaps in an ironic vein — that if the Department of Education is gone, so are student loans.

But Minsky said even with cuts at the agency, “it doesn’t fundamentally change the nature of the debt that folks owe. It doesn’t mean that you don’t have to repay their loans. It doesn’t mean that loans disappear.”

False: Your loans could change — or be reduced — by being moved into another part of the federal government.

Even if a person’s student loan portfolio was moved out of the Department of Education and into another office like the Treasury, as Trump has proposed, “it would just mean that a different agency was performing the oversight,” said Mayotte. “Terms and conditions of the loans aren’t going to change, the servicers aren’t going to change.”

False: Student loans can be forgiven because of Musk getting access to data 

A judge issued a temporary restraining order that stopped Musk’s DOGE staffers from accessing student loan data due to privacy concerns.

However, even if Musk and his affiliates were found to have isolated the Family Educational Rights and Privacy Act (FERPA), students would not be able to have their loans forgiven despite what circulating social media posts may claim.

Mayotte said this has not historically ever been a way to rectify a FERPA violation.

Where can I find information and guidance about my student loans?

The best information comes straight from the source itself — studentaid.gov, said Mayotte. But Californians also have a student loan ombudsman that they can reach out to for questions or be reminded of their rights. Questions can be sent to Celina.Damian@dfpi.ca.gov.

If you have an issue with your loan servicer, you can file a complaint with the state’s Department of Financial Protection and Innovation (DFPI). You can also reach out to DPFI by email at ask.DFPI@dfpi.ca.gov and by phone at 866-275-2677.

Other places to get updates on student loans include:

• Student Loan Planner
• The Institute of Student Loan Advisors
• Saving for College

Lastly, don’t forget to keep paying your student loans

Mayotte added that what has been buried under the latest news concerning the Department of Education layoffs is that many Americans’ credit sources have been going down due to not paying their student loans on time.

For the first time in over four years, said Mayotte, borrowers are “at risk of having their loans affect their credit reports for being 90 days or more delinquent. And I am seeing borrowers that were caught off guard by that.”

She said many borrowers have been used to pauses on payments during the height of the pandemic. However, those COVID-era protections are more or less gone, and Mayotte urged people to check their repayment schedule on studentaid.org to see if they need to resume their monthly payments.

She said people should check on what payment plans work best for them and try to reach out to a loan servicer if they need help.

“Most people — unless you’re on the SAVE plan or you’re in school — you’re due for payment now. If you become 90 days past due or more, it is going to affect your credit,” she warned.