Overview
- On December 22, 2025, the department updated its systems to remove the partial financial hardship requirement from Income-Based Repayment.
- Borrowers previously denied because their income was too high are encouraged to reapply online, and servicers will process held applications in the order received.
- IBR bases monthly payments on income and can discharge remaining balances after 20 or 25 years, depending on when loans were first taken out.
- The fix followed an interim court agreement with the American Federation of Teachers after earlier denials during the implementation delay.
- Under the One Big, Beautiful Bill Act, other income-driven plans are being phased out and a Repayment Assistance Plan with graduate borrowing caps is scheduled for July 2026, with consolidation required by June 30, 2026 for some borrowers to retain access.