In a major victory for educators and public service workers, AFT has reached a settlement with the U.S. Department of Education, with the Trump Administration agreeing to resume processing student loan forgiveness under the Income-Driven Repayment (IDR) program.
This outcome follows months of legal action and advocacy by AFT, which sued after the administration abruptly halted loan discharges earlier this year, leaving thousands of borrowers in limbo despite years of on-time payments. The settlement ensures that forgiveness for eligible borrowers will restart immediately and that all pending IDR applications will be reviewed and processed in the coming weeks.
“For nearly a decade, the AFT has fought for the rights of student loan borrowers to be freed from the shackles of unjust debt—and today, a huge part of that affordability fight was vindicated,” said AFT President Randi Weingarten in a statement following the settlement. “Our agreement means that those borrowers stuck in limbo can either get immediate relief or finally see a light at the end of the tunnel.”
The lawsuit, filed on behalf of AFT members and other affected borrowers, challenged the administration’s decision to freeze the long-standing IDR forgiveness process without notice or legal authority. The settlement requires the DOE to restart processing immediately and provide regular updates to ensure transparency and accountability. According to reporting from The Washington Post and Forbes, millions of borrowers could now see long-delayed loan balances wiped out within months.
Our union previously called attention to this issue when the administration first announced the pause; you can revisit our earlier coverage here.
For AFT members, help doesn’t stop with this win. Through Summer (AFT’s free student debt support platform), educators can access personalized guidance to manage repayment and maximize forgiveness options. Members can also join an upcoming AFT Student Debt Clinic to learn how to apply or check eligibility for programs like IDR and Public Service Loan Forgiveness (PSLF).
This settlement underscores what collective action can achieve: when educators organize and fight back, we can protect our rights and safeguard our future.