AFT sues Department of Education over blocked student loan repayment options

The American Federation of Teachers (AFT), representing 1.8 million members, has filed a lawsuit against the U.S. Department of Education (ED) over changes to student loan repayment options. The suit, AFT v. U.S. Department of Education, was lodged in federal court in Washington, D.C., and challenges recent actions by the ED that allegedly obstruct borrowers' access to income-driven repayment (IDR) plans and Public Service Loan Forgiveness (PSLF).

According to AFT President Randi Weingarten, "By effectively freezing the nation’s student loan system, the new administration seems intent on making life harder for working people." She further stated that the organization is suing "to restore access to the statutory programs that are an anchor for so many."

Three weeks prior to the lawsuit, federal officials reportedly removed IDR application forms from ED's website and instructed loan servicers to stop processing them. These plans allow borrowers to make payments based on their income and family size and are crucial for public service workers seeking PSLF.

Mike Pierce, Executive Director of the Student Borrower Protection Center (SBPC), expressed concern about borrowers struggling with increased monthly payments amid economic challenges: "Borrowers have a legal right to payments they can afford and today we are demanding that these rights are enforced by a federal judge."

E. Michelle Drake from Berger Montague PC highlighted Congress's mandate for offering IDR plans: "We look forward to restoring borrowers’ access to these vital, necessary, and required programs."

The controversy stems from an interpretation of a decision by the 8th Circuit Court related to an injunction affecting one IDR plan known as Saving on a Valuable Education (SAVE). The AFT argues this interpretation unjustly limits borrower access beyond what was intended.

As of now, more than one million borrowers remain in limbo without guidance on when their applications will be processed or when they might see reduced payments.

For more information on this case or details regarding AFT's position against ED's recent decisions, documents including a complaint copy and fact sheet are available through links provided by involved organizations.