Our endorsed partner Cambridge Credit Counseling offers a student loan update for NYSUT members and their loved ones.
UPDATE (3/31/25): As previously mentioned, applications for Income-Driven Repayment plans (IDRs) have reopened but it looks like processing them may be an issue. A hearing has been scheduled for mid-April at which point the court may intervene.
Public Service Loan Foregiveness (PSLF) will remain available because it was created by Congress, but there are still some roadblocks in the short term. A PSLF application will not be processed if the borrower is enrolled in the SAVE, PAYE, or ICR repayment plans, but it will be processed if the borrower was paying through the IBR plan. That obstacle appears to only be temporary, as the U.S. Department of Education has indicated that the PAYE and ICR plans will be extended soon. For those PSLF candidates who would have reached their 120th payment but have been caught up in the SAVE forbearance, the “Buyback” option is still available for them; please visit studentaid.gov for details.
Consolidations are once again available but the majority of borrowers may not want to take that step at the moment. There are two exceptions, however: 1. Recent college graduates can consolidate, and 2. Any parents looking to complete the double-loophole consolidation process should get to that without any additional delay. For those using the loophole strategy, all consolidations must be completed (not just the applications, but the actual consolidations) before July 1, 2025.
New Recertification Date Based on an Individual's IDR Status:
1. If an individual re-certified their income before February 20, 2025 and their loan servicer processed it, they won’t be able to change the payment as it is locked in for now.
2. If an individual re-certified their income before February 20, 2025 but their loan servicer did not process it, their recertification date will be extended by one year. Most borrowers may fall into this category since servicers halted recertifications quite a while ago.
3. If an individual had been asked to recertify but failed to do so and has since been placed on the Standard repayment plan (resulting in a substantial increase in their payment), they must submit a recertification request to reduce that payment. They should do so immediately by clicking here.
4. If the individual was not scheduled to recertify until after February 20, 2025, their recertification date has been extended by at least one year.
ORIGINAL STORY (3/25/25): While there may be changes regarding federal student loans in the next few months, the following information should help with any questions that NYSUT members or their loved ones may have at this point.
1. Public Service Loan Forgiveness (PSLF) is not going away as it can only be altered by Congress.
2. The SAVE repayment plan may be ended by the 8th U.S. Circuit Court of Appeals. Unlike the 36 months during the pandemic, however, individuals on the SAVE plan are not being credited toward the 120 payments they need for PSLF because they are not making payments.
3. Two other income-driven plans are being extended. The Income-Contingent Repayment plan (ICR) and the Pay As You Earn plan (PAYE) were in danger of being eliminated but now may survive. The process of extending those plans may take several weeks.
4. The Income-Based Repayment plan (IBR) was also created by Congress and will survive the 8th Circuit Court’s decision. When the situation becomes clearer, the IBR plan may be the most affordable payment option for those individuals who want to qualify for PSLF -- with the exception of Parent PLUS loan holders, who must repay those loans through the ICR plan.
5. No one is allowed to switch into any of the income-driven plans at this time. Paper and electronic applications have been frozen and will not be processed; that freeze may last until the end of May. Anyone who sent in an IDR application should have had their loans placed in an administrative forbearance.
6. Income recertification has been extended. If an individual is on any of the IDR plans, they will not have to rectify their income until February 2026 since the income-driven plans are effectively frozen.
What Options are Available?
For those individuals who have recently received requests for payment but haven't submitted an IDR application, they can request a forbearance or hardship deferment, or can contact their servicer to switch into the Graduated Extended repayment plan (provided the monthly payment is affordable). Note: Payments made through that plan would never count for PSLF so those individuals may want to request forbearance instead.
Cambridge Credit Counseling will continue to monitor changes to the student loan repayment program and will schedule additional free student loan webinars when the situation becomes clearer.
UPDATE: Income-Driven Repayment plan applications reopen - Learn More
Click here for information about student loan assistance or to attend a NYSUT Student Loan Workshop.