Key Student Loan Repayment Applications Reopen, but Processing Is Paused
Borrowers can apply for income-driven repayment plans again, but servicers aren’t yet permitted to process these applications.
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The Education Department reopened the application for all income-driven repayment (IDR) plans on Mar. 26, after a month-long suspension that blocked federal student loan borrowers from enrolling in an IDR plan or recertifying their income. While you can now submit an IDR application, servicers aren’t permitted to process them.
The department initially took down the IDR application after a court action in the lawsuits against SAVE, a new IDR plan introduced by the Biden administration.
The application reopening came a week after the American Federation of Teachers (AFT) filed a lawsuit against the Education Department, alleging the department broke federal law by blocking borrowers’ access to IDR plans and Public Service Loan Forgiveness (PSLF).
Still, the situation remains in flux, creating a confusing situation for borrowers.
“With this chaos, and with the uncertainty about which [repayment] plans are available and whether or not they can get onto these plans, and whether or not they're going to get the loan cancellation that they're entitled to, a lot of people are delaying very real life choices,” says Persis Yu, deputy executive director and managing counsel at the Student Borrower Protection Center, which is representing the AFT in the lawsuit.
Here’s what we know — and don’t know — about IDR plans, as of Apr. 1.
What we know about income-driven repayment
The IDR application is open, but looks different
SAVE is no longer on the updated IDR application. Additionally, you no longer have the option to check a box asking your servicer to place you on the repayment plan with the lowest monthly payment, says Scott Buchanan, executive director of the Student Loan Servicing Alliance.
As a result, you must do your own research about which plan works best for you. Use the Education Department's loan simulator to estimate your monthly bills and the total amount you’ll repay under various plans. Note that SAVE still appears on the simulator, though you can no longer enroll in it.
Income-Based Repayment is the safest IDR plan
SAVE is likely done for, says Robert Kelchun, a professor of higher education at the University of Tennessee, Knoxville, who studies income-driven repayment. However, there are three other IDR plans that borrowers can apply for right now:
If you need an income-driven repayment plan, experts say the IBR plan is the safest option. Unlike the other three IDR plans, IBR was established by Congress, so Congress would need to vote to change or remove it.
You can also opt for a repayment plan that doesn’t tie payments to income. The standard repayment plan, which splits your total debt into 120 installments over 10 years, is the best repayment plan for borrowers who want total certainty about their future payments, says Kelchun. But for borrowers with a large amount of debt relative to their income, monthly payments could be too high on the standard plan, he says.
“Borrowers need to keep in the back of their mind there's always the possibility that they have to go back to standard payments,” Kelchun says. “Before January, I would have said that's not going to happen, but given everything that's happened the last few months, who knows anymore? I think borrowers need to at least keep an eye on that possible worst case scenario for them.”
You retain forgiveness credit when switching to the IBR plan
If you decide to switch from a different IDR plan to the IBR plan, you’ll retain any forgiveness credit you earned under your previous IDR plan, according to the Education Department website.
The department “can and will still process loan forgiveness for the Income-Based Repayment (IBR) Plan, which was separately enacted by Congress. Payments on PAYE, SAVE, and ICR are counted toward IBR Plan forgiveness if the borrower enrolls in IBR,” the website says.
The Education Department does not explicitly say if IDR credit transfers to PAYE or ICR.
Keep in mind that forgiveness under SAVE, PAYE and ICR is currently on hold, as a result of the SAVE lawsuits. Servicers are only permitted to process IBR forgiveness at the moment.
Some IDR recertification deadlines extended to February 2026
While the IDR application was down, borrowers already enrolled were also blocked from recertifying their income, since the process requires the same form. This left some borrowers unable to meet their recertification deadline and risk getting kicked out of their IDR plan — through no fault of their own.
Your IDR recertification deadline may have moved to February 2026 if your original deadline was March 18 or later. Some borrowers with recertification deadlines before March 18 also got an extension. See the Q&A section on the Education Department's webpage for more details.
If you have questions, don’t see a new recertification date in your servicer account or notice an issue with your payment amounts, call your servicer and verify what’s going on.
What we don’t know about income-driven repayment
When processing of IDR applications will resume
Servicers will start processing IDR applications in the “near future,” according to the Education Department’s website. The department did not respond to NerdWallet’s request for a specific date.
Buchanan says he expects servicers to resume processing in early April, although that timeline is not set.
“We're basically having to update the systems to go back to what they were prior to the SAVE regulation,” says Buchanan. “Until we know exactly how long system updates will take, I don't think we can exactly say when processing will resume, but the goal is to get processing going as quickly as possible.”
Once processing resumes, submitted applications won’t necessarily be processed in the order they were received, Buchanan says. More likely, servicers will process them in order of complexity, he says, with straightforward applications processed first, followed by those that require manual work or communication with the borrower.
Applications with eligibility requirements — having to prove financial hardship, for example, which the IBR plan requires — may take longer to process, Buchanan says.
What happens to existing SAVE borrowers
Eight million borrowers are still enrolled in SAVE, as of Dec. 31, according to Education Department data. These borrowers have been in indefinite, interest-free forbearance since July. They don’t owe payments and no interest is building on their debt, but they’re also not earning credit toward PSLF or IDR forgiveness.
With SAVE on the chopping block, we don’t know what options these 8 million borrowers will have in the future.
What else should you do right now?
Watch out for student loan scams
Student loan scammers prey on borrowers during times of confusion and uncertainty. A scam might be someone calling and offering to get you into a different IDR plan — in exchange for a $300 fee.
It never costs money to change your repayment plan. Generally, servicers only call you if there’s an issue with your account, Buchanan says. Any information about repayment plans would come over email, he says.
“So if someone calls and says, ‘Hey, you know, I can help you get into the right plan,’ it's probably not us,” says Buchanan. “We will call if you go delinquent, we will call if there's a problem with your account, and we will certainly email and send you information about repayment plans, but that only will come from your actual servicer or the [Education] department.”
Keep meticulous student loan records
With mass Education Department layoffs and general chaos in the student loan system, you need to keep your own records and advocate for yourself. Download or screenshot this information in case any discrepancies or issues come up:
Your payment counter on studentaid.gov.
Monthly billing statements and payment records.
Progress towards PSLF or IDR forgiveness.
The master promissory note you signed when you took out the loan.
Any emails or letters from the Education Department or your servicer.
Notes or recordings from calls with your servicer.
Reach out for help if you need it
Start by calling your student loan servicer with any IDR questions. If you need further student loan help, contact your college’s financial aid office (even if you left school years ago), vetted nonprofit organizations and state-based student loan ombudsman offices.
“Unfortunately, I don't think we can rely on the [Education Department's Federal Student Aid] ombuds office, which has been gutted by this administration, or the Consumer Financial Protection Bureau,” Yu says.
Yu also suggests reaching out to your congressional representatives' constituent services offices, if student loan issues remain unresolved. Find out how to contact your elected officials on USA.gov.
