Education Department Reopens IDR Plan Applications

The Department of Education this week reopened a revised application for income-driven loan repayment plans and loan consolidation. This decision—which was first announced at a court hearing Tuesday and then affirmed in a news release Wednesday—marks the first time the application portal will be opened since the agency decided to close it entirely in February.

The department justified its original closure of the portal based on the ruling in a separate court case that banned one specific type of IDR plan—Saving on a Valuable Education—and parts of others. But now, following pressure from a lawsuit filed by the American Federation of Teachers, a key higher education union, the portal and applications for plans other than SAVE will be reopened.

“Because the online application incorporated provisions subject to the injunction, it was necessary to revise the form, making it unavailable to borrowers in the interim,” the department’s news release said.

AFT’s lawsuit, filed March 18, argues that by closing and not processing the applications, the Trump administration is ignoring a congressional mandate to offer loans with monthly payments based on income. The complaint also alleges that by cutting off access to the plans, the department will cause irreparable harm, forcing many borrowers to make higher payments and potentially causing them to default.

At this point, the department isn’t planning to start processing applications yet. Still, AFT and the Student Borrower Protection Center—the student loan advocacy group representing the teachers’ union—see the department’s decision as a positive step forward.

“Today’s announcement shows that when working people band together and demand justice, we can make progress,” AFT president Randi Weingarten said in a news release. “The federal government took a step because of our lawsuit to restore some borrowers’ rights. More must be done, but at the very least, the applications for IDR plans will be online and accessible.”