The White House is fast-tracking student debt relief for millions of American borrowers. How to see if you qualify

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The Trump administration has reached a new agreement with the American Federation of Teachers (AFT) that could unlock long-awaited student loan relief for millions of borrowers.

The agreement allows the Department of Education to resume processing forgiveness for borrowers enrolled in Income-Contingent Repayment (IDR), Pay As You Earn (PAYE) and the Public Service Loan Forgiveness (PSLF) programs — especially those who’ve been chipping away at their loans for more than two decades. These programs will remain in place until 2028, when they’re expected to be phased out under President Trump’s One Big Beautiful Bill Act (1).

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The deal also includes a tax break: Borrowers who qualify for forgiveness through eligible payments this year won’t owe taxes on the canceled debt, even if the forgiveness doesn’t take effect until 2026. After that, however, forgiven balances will once again be considered taxable income.

“This is a tremendous win for borrowers,” Winston Berkman-Breen, legal director for Protect Borrowers, told CNBC (2).

“The U.S. Department of Education has agreed to follow the law and deliver Congressionally mandated affordable payments and debt relief to hard-working public service workers across the country.”

For the roughly 2.5 million borrowers currently enrolled in ICR or PAYE, this new agreement could finally make debt forgiveness more than just a promise. Here’s how to find out if you qualify.

A pause with a price

In March, the AFT sued the Trump administration, arguing it unfairly blocked federal borrowers from accessing repayment and forgiveness programs guaranteed under their original loan terms.

The lawsuit followed a pause that left nearly 2 million borrowers in ICR plans in limbo (3). The administration said it was complying with court orders tied to the Biden-era Saving on a Valuable Education (SAVE) plan — a ruling it claimed could affect other IDR programs as well.

That pause marked a reversal from recent years, when the Department of Education under President Biden approved more than $180 billion in student debt cancellation for over 4 million borrowers, including roughly 1 million public service workers through the PSLF program (4).

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Things to keep in mind

Even with a new agreement in place, borrowers shouldn’t expect instant relief.

Staffing shortages and layoffs within the Department of Education could slow down how quickly forgiveness applications are reviewed and processed, Megan Walter, senior policy analyst at the National Association of Student Financial Aid Administrators, told ABC News (5).

Walter also noted that borrowers who keep making payments while their forgiveness applications are under review will get that money back if their application is approved. Still, she cautioned to keep pristine records.

If you think you could be eligible for this new wave of relief, it’s important to stay on top of your forgiveness status. Log in to your Federal Student Aid (FSA) account at studentaid.gov to check your loan type, confirm your repayment plan and make sure your contact information is up to date.

If you’re not eligible, but you’re still burdened with student loans, it could be helpful to seek a debt relief plan — one that not only tackles your student loans, but any consumer debt you may have, like credit cards or personal loans.

With Freedom Debt Relief, you can speak with a certified debt relief consultant for free, who can show you how much you can save by partnering with them.

Freedom Debt Relief negotiates settlements with your creditors until all of your enrolled debt is resolved. Once you approve your settlement offers, you can repay your debt with one simple monthly deposit, potentially giving you peace of mind and an easier time managing your budget.

If juggling the ins and outs of your payments seems overwhelming, budgeting apps like Rocket Money can give you a top-down view of your finances.

Rocket Money tracks and categorizes your expenses, providing a clear view of your cash, credit, and investments in one place. It can even uncover forgotten subscriptions, helping you cut unnecessary costs and save potentially hundreds annually. If you’re in debt, putting the cash you save towards your payments could help you dig your way out faster.

For a small fee, the app can also negotiate lower rates on your monthly bills, making it a valuable tool for keeping your finances on track.

Whether you’re eligible or not, it’s also worth double-checking who your loan servicer is. Many borrowers have seen their servicers change over the past year, which can affect where your paperwork and updates are sent. Borrowers eligible for the student loan debt relief should receive email notifications from the Department of Education this month.

Keep thorough records of every payment you make, including statements or screenshots, in case you need to verify your qualifying payments later. And be sure to watch for updates directly from the Department of Education.

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Article sources

We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.

Congress (1); CNBC (2); Business Insider (3); ABC News (4); New York Times (5)

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.