Income-Driven Repayment Lawsuit Rocks Ed Dept

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Emily Willis

Published - public Jul 4, 2025 - 00:00 1 Reads
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Income-Driven Repayment Lawsuit Rocks Ed Dept

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The search results indicate that there are two main lawsuits affecting Income-Driven Repayment (IDR) plans and the Department of Education:

  1. Lawsuits challenging the SAVE Plan: Several states (e.g., Arkansas, Florida, Georgia, Missouri, North Dakota, Ohio, Oklahoma) have filed lawsuits arguing that the Department of Education overstepped its authority with the SAVE Plan and other IDR forgiveness provisions. A federal appeals court (8th Circuit) issued an injunction, blocking the implementation of the SAVE plan and parts of other IDR plans (PAYE, ICR) related to forgiveness and interest subsidies. This led to the Department temporarily suspending online applications for all IDR plans and loan consolidation in February 2025. While some IDR applications (IBR, PAYE, ICR) and loan consolidation are back online as of March 26, 2025, the SAVE plan remains blocked. This also impacts the "one-time IDR account adjustment" and potentially Public Service Loan Forgiveness (PSLF) progress.
  2. American Federation of Teachers (AFT) lawsuit: The AFT, represented by the Student Borrower Protection Center (SBPC), sued the Department of Education in March 2025 for illegally shutting down access to IDR applications and halting processing. This lawsuit specifically aimed to restore borrowers' access to these plans and prevent harm to PSLF progress. As a result of this lawsuit, the Department of Education reopened IDR applications (excluding SAVE) and agreed to provide monthly status reports on the processing backlog.

It's important to distinguish between these two. The state-led lawsuits challenge the legality of the SAVE plan and certain forgiveness aspects of IDR. The AFT lawsuit challenges the cessation of access and processing of IDR applications, which was a response by the Department of Education to the injunctions from the state-led lawsuits.

I also see "Sweet v. Cardona" mentioned, but this appears to be a separate lawsuit related to Borrower Defense to Repayment claims for students defrauded by educational institutions, not directly related to the current IDR application and SAVE plan issues, though it also involves student loan forgiveness. I will focus on the IDR/SAVE plan lawsuits.

I have enough information to start drafting the article, ensuring I cover:

  • The nature of the lawsuits (states challenging SAVE, AFT challenging access).
  • The impact on borrowers (suspension of applications, SAVE forbearance, processing delays, impact on PSLF/IDR forgiveness progress, increased payments for some).
  • The Department of Education's response (reopening some applications, agreeing to reports).
  • Actionable advice for borrowers.

I will ensure to maintain the specified length, readability, SEO compliance, originality, and engagement.

IDR lawsuits SAVE Plan student loan forgiveness Department of Education student loan access

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