IBR Student Loan Forgiveness Paused: What Are The Effects And What Should Students Do Now?

Student Loan Forgiveness IBR: The US Department of Education has quietly paused student loan forgiveness under the Income-Based Repayment (IBR) plan, sparking confusion among borrowers who expected relief after making 20 or 25 years of qualifying payments.

Unlike other income-driven repayment (IDR) plans such as SAVE, PAYE, and ICR, which are currently blocked by court orders, IBR was passed by Congress and is not subject to the same legal challenges. Yet, forgiveness for eligible borrowers under IBR has been unexpectedly halted.

What Is the IBR Plan?

The IBR plan is designed to make monthly student loan payments manageable by capping them based on a borrower’s income and family size. Payments are recalculated annually. Borrowers with loans taken out before July 1, 2014, are eligible for forgiveness after 25 years, and those with loans after that date qualify in 20 years. Its congressional origin gives it stronger legal footing than newer plans like SAVE, which is why legal experts say there’s no legitimate reason for its forgiveness processing to be paused.

Why Is Forgiveness Under IBR Delayed?

The Education Department has attributed the delay to “system updates” linked to legal proceedings affecting other plans like SAVE. In a recent update, it stated: “Currently, IBR forgiveness is paused while our systems are updated… forgiveness will resume once those updates are completed.”

However, many are questioning why a plan not impacted by lawsuits is facing administrative delays. Some eligible borrowers have been waiting for discharge since mid-2024, without any timeline for when processing will resume.

Trump Administration's Role

Under the Trump administration, the Education Department—now led by Linda McMahon, co-founder of WWE—has taken a firmer stance on reconfiguring repayment systems. Critics argue that bureaucratic mismanagement and an ideological pivot are to blame for the broader slowdown in loan forgiveness processing.

No Court Is Blocking IBR

While SAVE, PAYE, and ICR are entangled in lawsuits, IBR stands unaffected by court rulings. The Education Department has even confirmed: “ED can and will still process loan forgiveness for the IBR Plan, which Congress separately enacted.” Despite this, actual forgiveness disbursement remains in limbo, pointing to a disconnect between legal authority and administrative execution.

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What Other Plans Are Paused?

Here’s a breakdown of paused IDR plans:

1. SAVE Plan: Replaced REPAYE; now blocked by court injunctions.

2. PAYE Plan: Capped payments at 10% of discretionary income; currently paused.

3. ICR Plan: Payments based on either 20% of discretionary income or a fixed 12-year repayment; also paused.

These plans were created through regulation, making them more susceptible to legal challenges compared to IBR.

What Should Borrowers Do Now?

If you’ve crossed the IBR forgiveness threshold:

1. Continue making payments — any overpayments should eventually be refunded once forgiveness resumes.

2. Request forbearance — but note, interest will accrue during this period.

3. Stay enrolled in IBR — especially since new borrowers will no longer have access once the new Repayment Assistance Plan (RAP) replaces existing options.

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Policy Shakeups: What’s Next?

The newly passed “Big, Beautiful Bill” will introduce RAP, phasing out SAVE, PAYE, and ICR for new borrowers. Existing IBR enrollees can stay and eventually qualify for forgiveness, but this transition adds to uncertainty.