• The Education Department has paused student loan forgiveness under the IBR plan.
• This decision affects approximately 2 million borrowers who rely on income-based repayment plans.
• The pause is due to ongoing litigation regarding the Biden administration's SAVE plan.
• All borrowers are advised to continue making payments, even while forgiveness is on hold.
• The Department has promised refunds for overpayments once forgiveness resumes.

The U.S. Department of Education has temporarily paused student loan forgiveness under the Income-Based Repayment (IBR) plan, impacting nearly 2 million borrowers. This decision comes amid ongoing legal challenges related to the Biden administration’s SAVE plan, which has resulted in court injunctions affecting multiple income-driven repayment programs. According to deputy press secretary Ellen Keast, "The Department has temporarily paused discharges for IBR borrowers in order to comply with ongoing court injunctions regarding the Biden Administration’s illegal attempts at student loan forgiveness," she stated, highlighting the confusion surrounding the forgiveness protocols for these plans The Hill, Business Insider, CBS News, and India Times.

This suspension has arisen from a broader legal dispute over the SAVE plan, which had been instrumental in allowing certain periods of forbearance to count toward IBR loan forgiveness. As the Department recalibrates payment histories to comply with legal standards, borrowers are urged to keep making their monthly payments to avoid potential penalties and maintain eligibility for forgiveness upon resumption CBS News, and India Times.

Despite this administrative hold, the Department of Education has assured that no payments made by borrowers beyond their eligibility point will be lost, promising that any overpayments will be refunded once the loan forgiveness processes resume The Hill, Business Insider, CBS News, and India Times.

As borrowers navigate this uncertainty, the Department has recommended they regularly check the status of their loans with their servicer and stay informed about updates regarding their repayment plans. With over 33 million individuals currently enrolled in various federal income-driven repayment options, the outcome of this recalibration could have significant implications for future loan forgiveness strategies in the U.S. The Hill, India Times, and Business Insider.